LG-2013.6.30-10Q

 
 
 
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 10-Q
[ X ]
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended June 30, 2013
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 1-16681
 

THE LACLEDE GROUP, INC.
(Exact name of registrant as specified in its charter)
Missouri
(State of Incorporation)
74-2976504
(I.R.S. Employer Identification number)
720 Olive Street
St. Louis, MO  63101
(Address and zip code of principal executive offices)
 
314-342-0500
(Registrant’s telephone number, including area code)

Indicate by check mark if 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 report) and (2) has been subject to such filing requirements for the past 90 days. Yes [ X ] No [     ]

has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ X ] No [     ]

is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 
Large accelerated filer
[ X ]
 
Accelerated filer
[     ]
 
Non-accelerated filer
[     ]
 
Smaller reporting company
[     ]

is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [     ] No [ X ]

As of July 26, 2013, there were 32,692,182 shares of the registrant’s Common Stock, par value $1.00 per share, outstanding.
 
 
 
 
 


Table of Contents

TABLE OF CONTENTS
Page No.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


2

Table of Contents

PART I. FINANCIAL INFORMATION

The interim financial statements included herein have been prepared by The Laclede Group, Inc. (Laclede Group or the Company), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Company’s Form 10-K for the fiscal year ended September 30, 2012.


3

Table of Contents

Item 1. Financial Statements

THE LACLEDE GROUP, INC.
STATEMENTS OF CONSOLIDATED INCOME
(UNAUDITED)

 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
(Thousands, Except Per Share Amounts)
2013
 
2012
 
2013
 
2012
Operating Revenues:
 

 
 
 
 

 
 
Gas Utility
$
131,517

 
$
116,459

 
$
735,726

 
$
665,981

Gas Marketing
33,433

 
70,014

 
129,937

 
288,036

Other
339

 
376

 
4,242

 
1,920

Total Operating Revenues
165,289

 
186,849

 
869,905

 
955,937

Operating Expenses:
 
 
 
 
 
 
 
Gas Utility
 
 
 
 
 
 
 
Natural and propane gas
43,233

 
46,641

 
410,189

 
364,556

Other operation and maintenance expenses
42,404

 
38,351

 
123,245

 
125,028

Depreciation and amortization
11,519

 
10,186

 
33,742

 
30,450

Taxes, other than income taxes
12,968

 
10,842

 
49,525

 
45,602

Total Gas Utility Operating Expenses
110,124

 
106,020

 
616,701

 
565,636

Gas Marketing
40,583

 
65,420

 
133,959

 
279,784

Other
2,301

 
364

 
13,029

 
1,784

Total Operating Expenses
153,008

 
171,804

 
763,689

 
847,204

Operating Income
12,281

 
15,045

 
106,216

 
108,733

Other Income and (Income Deductions) – Net
(398
)
 
451

 
2,024

 
3,771

Interest Charges:
 
 
 
 
 
 
 
Interest on long-term debt
6,266

 
5,739

 
17,393

 
17,218

Other interest charges
594

 
427

 
2,197

 
1,541

Total Interest Charges
6,860

 
6,166

 
19,590

 
18,759

Income Before Income Taxes
5,023

 
9,330

 
88,650

 
93,745

Income Tax (Benefit) Expense
(1,562
)
 
897

 
26,256

 
30,454

Net Income
$
6,585

 
$
8,433

 
$
62,394

 
$
63,291

 
 
 
 
 
 
 
 
Weighted Average Number of Common Shares Outstanding:
 
 
 
 
 
 
 
Basic
26,110

 
22,282

 
23,634

 
22,243

Diluted
26,194

 
22,357

 
23,708

 
22,318

 
 
 
 
 
 
 
 
Basic Earnings Per Share of Common Stock
$
0.25

 
$
0.38

 
$
2.62

 
$
2.83

 
 
 
 
 
 
 
 
Diluted Earnings Per Share of Common Stock
$
0.25

 
$
0.38

 
$
2.62

 
$
2.82

 
 
 
 
 
 
 
 
Dividends Declared Per Share of Common Stock
$
0.425

 
$
0.415

 
$
1.275

 
$
1.245

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


4

Table of Contents

THE LACLEDE GROUP, INC.
STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME
(UNAUDITED)

 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
(Thousands)
2013
 
2012
 
2013
 
2012
Net Income
$
6,585

 
$
8,433

 
$
62,394

 
$
63,291

Other Comprehensive Income (Loss), Before Tax:
 
 
 
 
 
 
 
Net gains (losses) on cash flow hedging derivative instruments:
 
 
 
 
 
 
 
Net hedging gain (loss) arising during the period
27,614

 
(1,733
)
 
21,414

 
6,420

Reclassification adjustment for losses (gains) included in
 
 
 
 
 
 
 
net income
1,318

 
(6,171
)
 
3,544

 
(8,593
)
Net unrealized gains (losses) on cash flow hedging
 
 
 
 
 
 
 
derivative instruments
28,932

 
(7,904
)
 
24,958

 
(2,173
)
Defined benefit pension and other postretirement plans:
 
 
 
 
 
 
 
Net actuarial loss arising during the period

 

 

 
(2,366
)
    Amortization of actuarial loss included in net periodic
 
 
 
 
 
 
 
pension and postretirement benefit cost
90

 
66

 
271

 
3,639

Net defined benefit pension and other postretirement plans
90

 
66

 
271

 
1,273

Other Comprehensive Income (Loss), Before Tax
29,022

 
(7,838
)
 
25,229

 
(900
)
Income Tax Expense (Benefit) Related to Items of Other
 
 
 
 
 
 
 
Comprehensive Income
10,846

 
(3,028
)
 
9,429

 
(348
)
Other Comprehensive Income (Loss), Net of Tax
18,176

 
(4,810
)
 
15,800

 
(552
)
Comprehensive Income
$
24,761

 
$
3,623

 
$
78,194

 
$
62,739

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


5

Table of Contents

THE LACLEDE GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

 
June 30,
 
Sept. 30,
 
June 30,
(Thousands)
2013
 
2012
 
2012
ASSETS
 
 
 
 
 
Utility Plant
$
1,567,296

 
$
1,497,419

 
$
1,455,004

Less:  Accumulated depreciation and amortization
484,380

 
478,120

 
474,008

Net Utility Plant
1,082,916

 
1,019,299

 
980,996

Non-utility property
5,892

 
6,039

 
5,899

Other investments
53,337

 
50,775

 
55,117

Other Property and Investments
59,229

 
56,814

 
61,016

Current Assets:
 
 
 
 
 
Cash and cash equivalents
556,489

 
27,457

 
21,523

Accounts receivable:
 
 
 
 
 
Utility
70,380

 
64,027

 
65,762

Non-utility
53,678

 
51,042

 
47,335

Other
17,123

 
26,478

 
22,927

Allowance for doubtful accounts
(9,024
)
 
(7,705
)
 
(8,842
)
Delayed customer billings
11,319

 

 

Inventories:
 
 
 
 
 
Natural gas stored underground
59,171

 
92,729

 
55,192

Propane gas
8,963

 
10,200

 
10,051

Materials and supplies at average cost
4,477

 
3,543

 
3,917

Natural gas receivable
24,304

 
22,377

 
19,710

Derivative instrument assets
21,279

 
2,855

 
3,879

Unamortized purchased gas adjustments
6,230

 
40,674

 
9,158

Deferred income taxes
2,888

 

 

Prepayments and other
14,112

 
9,339

 
11,079

Total Current Assets
841,389

 
343,016

 
261,691

Deferred Charges:
 
 
 
 
 
Regulatory assets
432,700

 
456,047

 
433,376

Other
5,805

 
5,086

 
4,259

Total Deferred Charges
438,505

 
461,133

 
437,635

Total Assets
$
2,422,039

 
$
1,880,262

 
$
1,741,338


6

Table of Contents


THE LACLEDE GROUP, INC.
CONSOLIDATED BALANCE SHEETS (Continued)
(UNAUDITED)

 
June 30,.
 
Sept. 30,.
 
June 30,
(Thousands, except share amounts)
2013
 
2012
 
2012
CAPITALIZATION AND LIABILITIES
 
 
 
 
 
Capitalization:
 
 
 
 
 
  Common stock (70,000,000 shares authorized, 32,675,659,
    22,539,431, and 22,505,440 shares issued, respectively)
$
32,676

 
$
22,539

 
$
22,505

Paid-in capital
592,946

 
168,607

 
166,717

Retained earnings
443,691

 
414,581

 
424,588

Accumulated other comprehensive income (loss)
11,684

 
(4,116
)
 
(2,652
)
Total Common Stock Equity
1,080,997

 
601,611

 
611,158

Long-term debt (less current portion)
464,444

 
339,416

 
339,401

Total Capitalization
1,545,441

 
941,027

 
950,559

Current Liabilities:
 
 
 
 
 
Notes payable

 
40,100

 

Accounts payable
104,862

 
89,503

 
81,322

Advance customer billings

 
25,146

 
6,225

Current portion of long-term debt

 
25,000

 
25,000

Wages and compensation accrued
13,386

 
13,908

 
12,653

Dividends payable
14,454

 
9,831

 
9,664

Customer deposits
7,828

 
8,565

 
9,123

Interest accrued
3,887

 
8,590

 
5,405

Taxes accrued
28,522

 
11,304

 
13,040

Deferred income taxes

 
6,675

 
311

Other
9,862

 
13,502

 
16,540

Total Current Liabilities
182,801

 
252,124

 
179,283

Deferred Credits and Other Liabilities:
 
 
 
 
 
Deferred income taxes
377,965

 
355,509

 
335,366

Unamortized investment tax credits
2,953

 
3,113

 
3,166

Pension and postretirement benefit costs
181,691

 
196,558

 
158,011

Asset retirement obligations
42,097

 
40,368

 
28,723

Regulatory liabilities
58,382

 
56,319

 
53,867

Other
30,709

 
35,244

 
32,363

Total Deferred Credits and Other Liabilities
693,797

 
687,111

 
611,496

Commitments and Contingencies (Note 12)

 

 

Total Capitalization and Liabilities
$
2,422,039

 
$
1,880,262

 
$
1,741,338

 
 
 
 
 


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Table of Contents

THE LACLEDE GROUP, INC.
STATEMENTS OF CONSOLIDATED CASH FLOWS
(UNAUDITED) 
 
Nine Months Ended
 
June 30,
(Thousands)
2013
 
2012
Operating Activities:
 
 
 
 Net Income
$
62,394

 
$
63,291

  Adjustments to reconcile net income to net cash provided by (used in)
      operating activities:
 
 
 
Depreciation, amortization, and accretion
34,721

 
30,900

Deferred income taxes and investment tax credits
13,208

 
22,448

Other – net
1,753

 
(425
)
Changes in assets and liabilities:
 
 
 
Accounts receivable – net
1,685

 
(2,699
)
Unamortized purchased gas adjustments
34,444

 
16,561

Deferred purchased gas costs
12,160

 
(25,429
)
Accounts payable
21,717

 
(15,025
)
Delayed customer billings - net
(36,465
)
 
(9,005
)
Taxes accrued
16,562

 
568

Natural gas stored underground
33,558

 
59,978

Other assets and liabilities
(28,693
)
 
(12,964
)
Net cash provided by operating activities
167,044

 
128,199

Investing Activities:
 
 
 
Capital expenditures
(96,816
)
 
(76,780
)
Other investments
(2,558
)
 
(1,388
)
Net cash used in investing activities
(99,374
)
 
(78,168
)
Financing Activities:
 
 
 
Issuance of long-term debt
125,000

 

Maturity of first mortgage bonds
(25,000
)
 

Repayment of short-term debt – net
(40,100
)
 
(46,000
)
Changes in book overdrafts
(1,139
)
 
223

Issuance of common stock
431,329

 
3,162

Non-employee directors’ restricted stock awards

 
(565
)
Dividends paid
(28,651
)
 
(27,599
)
Employees’ taxes paid associated with restricted shares withheld upon vesting
(736
)
 
(1,171
)
Excess tax benefits from stock-based compensation
1,135

 
208

Other
(476
)
 
(43
)
Net cash provided by (used in) financing activities
461,362

 
(71,785
)
Net Increase (Decrease) in Cash and Cash Equivalents
529,032

 
(21,754
)
Cash and Cash Equivalents at Beginning of Period
27,457

 
43,277

Cash and Cash Equivalents at End of Period
$
556,489

 
$
21,523

 
 
 
 
Supplemental Disclosure of Cash Paid (Refunded) During the Period for:
 
 
 
Interest
$
22,666

 
$
21,811

Income taxes
(2,844
)
 
7,064

 
 
 

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Table of Contents

THE LACLEDE GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

1.        SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

These notes are an integral part of the accompanying unaudited consolidated financial statements of The Laclede Group, Inc. (Laclede Group or the Company) and its subsidiaries. In the opinion of Laclede Group, this interim report includes all adjustments (consisting of only normal recurring accruals) necessary for the fair presentation of the results of operations for the periods presented. This Form 10-Q should be read in conjunction with the Notes to Consolidated Financial Statements contained in the Company’s Fiscal Year 2012 Form 10-K.
The consolidated financial position, results of operations, and cash flows of Laclede Group are comprised primarily from the financial position, results of operations, and cash flows of Laclede Gas Company (Laclede Gas or the Utility). Laclede Gas is a regulated natural gas distribution utility having a material seasonal cycle. As a result, these interim statements of income for Laclede Group are not necessarily indicative of annual results or representative of succeeding quarters of the fiscal year. Due to the seasonal nature of the business of Laclede Gas, earnings are typically concentrated in the November through April period, which generally corresponds with the heating season. Laclede Energy Resources, Inc. (LER) includes its wholly owned subsidiary, LER Storage Services, Inc., which became operational on January 1, 2012.
REVENUE RECOGNITION - Laclede Gas reads meters and bills its customers on monthly cycles. The Utility records its gas utility revenues from gas sales and transportation services on an accrual basis that includes estimated amounts for gas delivered, but not yet billed. The accruals for unbilled revenues are reversed in the subsequent accounting period when meters are actually read and customers are billed. The amounts of accrued unbilled revenues at June 30, 2013 and 2012, for the Utility, were $8.7 million and $9.0 million, respectively. The amount of accrued unbilled revenue at September 30, 2012 was $11.6 million.
GROSS RECEIPTS TAXES - Gross receipts taxes associated with Laclede Gas’ natural gas utility service are imposed on the Utility and billed to its customers. These amounts are recorded gross in the Statements of Consolidated Income. Amounts recorded in Gas Utility Operating Revenues for the quarters ended June 30, 2013 and 2012 were $7.8 million and $5.7 million, respectively. Amounts recorded in Gas Utility Operating Revenues for the nine months ended June 30, 2013 and 2012 were $35.3 million and $31.4 million, respectively. Gross receipts taxes are expensed by the Utility and included in the Taxes, other than income taxes line.
NEW ACCOUNTING STANDARDS - In June 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-05, “Presentation of Comprehensive Income,” to amend ASC Topic 220, “Comprehensive Income,” by changing certain financial statement presentation requirements. Under the amended guidance, entities may either present a single continuous statement of comprehensive income or, consistent with the Company’s current presentation, provide separate but consecutive statements (a statement of income and a statement of comprehensive income). ASU No. 2011-05 would have required that, regardless of the method chosen, reclassification adjustments from other comprehensive income to net income be presented on the face of the financial statements, displaying the effect on both net income and other comprehensive income. However, in December 2011, the FASB issued ASU No. 2011-12 to defer the effective date of this particular requirement while it reconsiders this provision of the guidance. The amendments in these ASUs do not change the items that are required to be reported in other comprehensive income and, accordingly, did not impact total net income, comprehensive income, or earnings per share upon adoption in the first quarter of fiscal year 2013.
In December 2011, the FASB issued ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” to amend ASC Topic 210, “Balance Sheet,” to require additional disclosures about financial instruments and derivative instruments that have been presented on a net basis (offset) in the balance sheet. Additionally, information about financial instruments and derivative instruments that are subject to enforceable master netting arrangements or similar agreements, irrespective of whether they are presented net in the balance sheet, is required to be disclosed. The ASU impacts disclosures only and will not require any changes to financial statement presentation. The Company will present the new disclosures retrospectively beginning in the first quarter of fiscal year 2014.
In February 2013, the FASB issued ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” This ASU amends Accounting Standards Codification (ASC) Topic 220, “Comprehensive Income,” by requiring entities to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to provide information on significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income, but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. The Company will present the new disclosures prospectively beginning in the first quarter of fiscal year 2014.

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Table of Contents

2.        PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS

Pension Plans

Laclede Gas has non-contributory, defined benefit, trusteed forms of pension plans covering substantially all employees. Plan assets consist primarily of corporate and U.S. government obligations and a growth segment consisting of exposure to equity markets, commodities, real estate and inflation-indexed securities, achieved through derivative instruments.
Pension costs for quarters ended June 30, 2013 and 2012 were $4.2 million and $4.1 million, respectively, including amounts charged to construction. Pension costs for nine months ended June 30, 2013 and 2012 were $12.5 million and $15.9 million, respectively, including amounts charged to construction.
The net periodic pension costs include the following components:

 
Three Months Ended
 
Nine Months Ended
 
June 30,
 
June 30,
(Thousands)
2013
 
2012
 
2013
 
2012
Service cost – benefits earned during the period
$
2,311

 
$
2,295

 
$
6,933

 
$
6,908

Interest cost on projected benefit obligation
4,066

 
4,824

 
12,198

 
14,535

Expected return on plan assets
(4,741
)
 
(4,899
)
 
(14,223
)
 
(14,697
)
Amortization of prior service cost
136

 
148

 
408

 
444

Amortization of actuarial loss
2,839

 
2,252

 
8,517

 
6,788

Loss on lump-sum settlement
12,346

 

 
12,346

 
3,407

Sub-total
16,957

 
4,620

 
26,179

 
17,385

Regulatory adjustment
(12,780
)
 
(484
)
 
(13,647
)
 
(1,451
)
Net pension cost
$
4,177

 
$
4,136

 
$
12,532

 
$
15,934


Pursuant to the provisions of the Laclede Gas pension plans, pension obligations may be satisfied by lump-sum cash payments. Pursuant to a Missouri Public Service Commission (MoPSC or Commission) Order, lump-sum payments are recognized as settlements (which can result in gains or losses) only if the total of such payments exceeds 100% of the sum of service and interest costs. Lump-sum payments recognized as settlements were $39.7 million and $6.4 million during the nine months ended June 30, 2013 and June 30, 2012, respectively.
Pursuant to a MoPSC Order, the return on plan assets is based on the market-related value of plan assets implemented prospectively over a four-year period. Gains or losses not yet includible in pension cost are amortized only to the extent that such gain or loss exceeds 10% of the greater of the projected benefit obligation or the market-related value of plan assets. Such excess is amortized over the average remaining service life of active participants. The recovery in rates for the Utility’s qualified pension plans is based on an annual allowance of $15.5 million effective January 1, 2011. The difference between these amounts and pension expense as calculated pursuant to the above and that otherwise would be included in the Statements of Consolidated Income and Statements of Consolidated Comprehensive Income is deferred as a regulatory asset or regulatory liability.
The funding policy of Laclede Gas 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. Fiscal year 2013 contributions to the pension plans through June 30, 2013 were $23.4 million to the qualified trusts and approximately $0.4 million to the non-qualified plans. Laclede Gas does not expect to make additional contributions to its qualified, trusteed pension plans during the remaining three months of fiscal year 2013. Contributions to the non-qualified pension plans for the remaining three months of fiscal 2013 are anticipated to be approximately $0.8 million.

Postretirement Benefits

Laclede Gas provides certain life insurance benefits at retirement. Medical insurance is available after early retirement until age 65. The transition obligation not yet includible in postretirement benefit cost is being amortized over 20 years. Postretirement benefit costs for both the quarters ended June 30, 2013 and 2012 were $2.4 million, including amounts charged to construction. Postretirement benefit costs for both the nine months ended June 30, 2013 and 2012 were $7.1 million, including amounts charged to construction.

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Table of Contents

Net periodic postretirement benefit costs consisted of the following components:

 
Three Months Ended June 30,
 
Nine Months Ended June 30,
(Thousands)
2013
 
2012
 
2013
 
2012
Service cost – benefits earned during the period
$
2,534

 
$
2,015

 
$
7,601

 
$
6,045

Interest cost on accumulated
postretirement benefit obligation
1,278

 
1,380

 
3,836

 
4,140

Expected return on plan assets
(1,082
)
 
(991
)
 
(3,244
)
 
(2,973
)
Amortization of transition obligation
24

 
34

 
70

 
102

Amortization of prior service cost (credit)

 
(518
)
 
2

 
(1,554
)
Amortization of actuarial loss
1,325

 
1,065

 
3,975

 
3,195

Sub-total
4,079

 
2,985

 
12,240

 
8,955

Regulatory adjustment
(1,699
)
 
(604
)
 
(5,097
)
 
(1,812
)
Net postretirement benefit cost
$
2,380

 
$
2,381

 
$
7,143

 
$
7,143


Missouri state law provides for the recovery in rates of costs accrued pursuant to GAAP provided that such costs are funded through an independent, external funding mechanism. Laclede Gas established Voluntary Employees’ Beneficiary Association (VEBA) and Rabbi trusts as its external funding mechanisms. VEBA and Rabbi trusts’ assets consist primarily of money market securities and mutual funds invested in stocks and bonds.
Pursuant to a MoPSC Order, the return on plan assets is based on the market-related value of plan assets implemented prospectively over a four-year period. Gains and losses not yet includible in postretirement benefit cost are amortized only to the extent that such gain or loss exceeds 10% of the greater of the accumulated postretirement benefit obligation or the market-related value of plan assets. Such excess is amortized over the average remaining service life of active participants. The recovery in rates for the Utility’s postretirement benefit plans is based on an annual allowance of $9.5 million effective January 1, 2011. The difference between these amounts and postretirement benefit cost based on the above and that otherwise would be included in the Statements of Consolidated Income and Statements of Consolidated Comprehensive Income is deferred as a regulatory asset or regulatory liability.
Laclede Gas’ funding policy is to contribute amounts to the trusts equal to the periodic benefit cost calculated pursuant to GAAP as recovered in rates. Fiscal year 2013 contributions to the postretirement plans through June 30, 2013 were $8.2 million to the qualified trusts and approximately $0.4 million paid directly to participants from Laclede Gas' funds. Contributions to the postretirement plans for the remaining three months of fiscal year 2013 are anticipated to be $8.2 million to the qualified trusts and $0.2 million paid directly to participants from Laclede Gas’ funds.

3.        STOCK-BASED COMPENSATION

Awards of stock-based compensation are made pursuant to The Laclede Group 2006 Equity Incentive Plan (2006 Plan). Refer to Note 3 of the Consolidated Financial Statements included in the Company’s Form 10-K for the fiscal year ended September 30, 2012 for descriptions of the plan.

Restricted Stock Awards

During the nine months ended June 30, 2013, the Company granted 108,419 performance-contingent restricted stock units to executive officers and key employees at a weighted average grant date fair value of $34.48 per share. This number represents the maximum shares that can be earned pursuant to the terms of the awards. Most of these stock units have a performance period ending September 30, 2015. While the participants have no interim voting rights on these stock units, dividends accrue during the performance period and are paid to the participants upon vesting, but are subject to forfeiture if the underlying stock units do not vest. The number of stock units that will ultimately vest is dependent upon the attainment of certain levels of earnings and other strategic goals, as well as the Company’s level of total shareholder return (TSR) during the performance period relative to a comparator group of companies. This TSR provision is considered a market condition under GAAP.

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Activity of restricted stock and restricted stock units subject to performance and/or market conditions during the nine months ended June 30, 2013 is presented below:

 
Restricted Stock/
Stock Units
 
Weighted
Average
Grant Date
Fair Value
Nonvested at September 30, 2012
232,403

 
$
30.89

Granted (maximum shares that can be earned)
108,419

 
$
34.48

Vested
(37,436
)
 
$
27.02

Forfeited
(48,782
)
 
$
25.71

Nonvested at June 30, 2013
254,604

 
$
33.98


During the nine months ended June 30, 2013, the Company granted 58,924 shares of time-vested restricted stock and stock units to executive officers, key employees, and directors at a weighted average grant date fair value of $39.98 per share. Most of these shares were awarded on December 3, 2012 and vest December 3, 2015. In the interim, participants receive full voting rights and dividends, which are not subject to forfeiture.    
Time-vested restricted stock and stock unit activity for the nine months ended June 30, 2013 is presented below:

 
Restricted Stock/
Stock Units
 
Weighted
Average
Grant Date
Fair Value
Nonvested at September 30, 2012
115,115

 
$
36.54

Granted
58,924

 
$
39.98

Vested
(20,600
)
 
$
30.55

Forfeited
(6,500
)
 
$
38.54

Nonvested at June 30, 2013
146,939

 
$
38.67


During the nine months ended June 30, 2013, 58,036 shares of restricted stock and stock units (performance-contingent and time-vested), awarded on November 4, 2009, December 1, 2009, January 4, 2010, and May 3, 2010 vested. The Company withheld 18,898 of the vested shares at a weighted average price of $38.96 per share pursuant to elections by employees to satisfy tax withholding obligations.

Stock Option Awards

Stock option activity for the nine months ended June 30, 2013 is presented below:

 
Stock
Options
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Remaining
Contractual
Term
(Years)
 
Aggregate
Intrinsic
Value
($000)
Outstanding at September 30, 2012
214,000

 
$
31.02

 
 
 
 
Granted

 
$

 
 
 
 
Exercised
(70,500
)
 
$
29.42

 
 
 
 
Forfeited

 
$

 
 
 
 
Expired

 
$

 
 
 
 
Outstanding at June 30, 2013
143,500

 
$
31.81

 
2.0
 
$
1,988

Fully Vested and Expected to Vest at June 30, 2013
143,500

 
$
31.81

 
2.0
 
$
1,988

Exercisable at June 30, 2013
143,500

 
$
31.81

 
2.0
 
$
1,988


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Table of Contents

The closing price of the Company’s common stock was $45.66 at June 30, 2013.

Equity Compensation Costs

The amounts of compensation cost recognized for share-based compensation arrangements are presented below:

 
Three Months Ended June 30,
 
Nine Months Ended June 30,
(Thousands)
2013
 
2012
 
2013
 
2012
Total equity compensation cost
$
1,654

 
$
678

 
$
3,413

 
$
2,029

Compensation cost capitalized
(536
)
 
(230
)
 
(1,075
)
 
(589
)
Compensation cost recognized in net income, before income taxes
1,118

 
448

 
2,338

 
1,440

Income tax benefit recognized in net income
(428
)
 
(173
)
 
(895
)
 
(556
)
Compensation cost recognized in net income, net of income tax
$
690

 
$
275

 
$
1,443

 
$
884


As of June 30, 2013, there was $6.1 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements. That cost is expected to be recognized over a weighted average period of 2.1 years.

4.        EARNINGS PER COMMON SHARE

 
Three Months Ended June 30,
 
Nine Months Ended June 30,
(Thousands, Except Per Share Amounts)
2013
 
2012
 
2013
 
2012
Basic EPS:
 
 
 
 
 

 
 
Net Income
$
6,585

 
$
8,433

 
$
62,394

 
$
63,291

Less: Income allocated to participating securities
81

 
42

 
389

 
356

Net Income Available to Common Shareholders
$
6,504

 
$
8,391

 
$
62,005

 
$
62,935

 
 
 
 
 
 
 
 
Weighted Average Shares Outstanding
26,110

 
22,282

 
23,634

 
22,243

Earnings Per Share of Common Stock
$
0.25

 
$
0.38

 
$
2.62

 
$
2.83

 
 
 
 
 
 
 
 
Diluted EPS:
 
 
 
 
 
 
 
Net Income
$
6,585

 
$
8,433

 
$
62,394

 
$
63,291

Less: Income allocated to participating securities
81

 
42

 
388

 
355

Net Income Available to Common Shareholders
$
6,504

 
$
8,391

 
$
62,006

 
$
62,936

 
 
 
 
 
 
 
 
Weighted Average Shares Outstanding
26,110

 
22,282

 
23,634

 
22,243

Dilutive Effect of Stock Options, Restricted Stock,
 
 
 
 
 
 
 
and Restricted Stock Units
84

 
75

 
74

 
75

Weighted Average Diluted Shares
26,194

 
22,357

 
23,708

 
22,318

Earnings Per Share of Common Stock
$
0.25

 
$
0.38

 
$
2.62

 
$
2.82

 
 
 
 
 
 
 
 
Outstanding Shares Excluded from the
 
 
 
 
 
 
 
Calculation of Diluted EPS Attributable to:
 
 
 
 
 
 
 
Restricted stock and stock units subject to
 
 
 
 
 
 
 
performance and/or market conditions
196

 
204

 
196

 
202



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Table of Contents

5.        STOCKHOLDERS' EQUITY

On May 29, 2013, Laclede Group issued 10,005,000 shares of its common stock in a public offering at a price of $44.50 per share. Proceeds from the offering, net of underwriting expenses, were $428.0 million and were recorded as additions to common stock and paid-in capital on the consolidated balance sheets. The Company intends to use the proceeds from the offering to fund a portion of the pending acquisition of MGE, as discussed further in Note 13, Acquisition Agreements.


6.        FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts and estimated fair values of financial instruments not measured at fair value on a recurring basis are as follows:

 
 
 
 
 
Classification of Estimated Fair Value
(Thousands)
Carrying
Amount
 
Fair
Value
 
Quoted
Prices in Active Markets
(Level 1)
 
Significant Observable Inputs
(Level 2)
 
Significant Unobservable Inputs
(Level 3)
As of June 30, 2013
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
556,489

 
$
556,489

 
$
421,518

 
$
134,971

 
$

Short-term debt

 

 

 

 

Long-term debt, including current portion
464,444

 
506,328

 

 
506,328

 

 
 
 
 
 
 
 
 
 
 
As of Sept. 30, 2012
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
27,457

 
$
27,457

 
$
17,380

 
$
10,077

 
$

Short-term debt
40,100

 
40,100

 

 
40,100

 

Long-term debt, including current portion
364,416

 
452,768

 

 
452,768

 

 
 
 
 
 
 
 
 
 
 
As of June 30, 2012
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
21,523

 
$
21,523

 
$
11,560

 
$
9,963

 
$

Short-term debt

 

 

 

 

Long-term debt, including current portion
364,401

 
445,961

 

 
445,961

 


The carrying amounts for cash and cash equivalents and short-term debt approximate fair value due to the short maturity of these instruments. The fair values of long-term debt are estimated based on market prices for similar issues. Refer to Note 7, Fair Value Measurements, for information on financial instruments measured at fair value on a recurring basis.


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Table of Contents

7.        FAIR VALUE MEASUREMENTS

The following table categorizes the assets and liabilities in the Consolidated Balance Sheets that are accounted for at fair value on a recurring basis in periods subsequent to initial recognition.

(Thousands)
Quoted
Prices in
Active
Markets
(Level 1)
 
Significant
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
 
Effects of Netting and Cash Margin Receivables
/Payables
 
Total
As of June 30, 2013
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
U. S. Stock/Bond Mutual Funds
$
13,980

 
$

 
$

 
$

 
$
13,980

NYMEX/ICE natural gas contracts
7,066

 
399

 

 
(4,635
)
 
2,830

NYMEX gasoline and heating
oil contracts
136

 

 

 
(136
)
 

Natural gas commodity contracts

 
740

 
372

 
(243
)
 
869

Interest rate swaps
$

 
$
17,689

 
$

 
$

 
$
17,689

Total
$
21,182

 
$
18,828

 
$
372

 
$
(5,014
)
 
$
35,368

Liabilities
 
 
 
 
 
 
 
 
 
NYMEX/ICE natural gas contracts
$
3,950

 
$
329

 
$

 
$
(4,279
)
 
$

Natural gas commodity contracts

 
1,083

 

 
(243
)
 
840

Total
$
3,950

 
$
1,412

 
$

 
$
(4,522
)
 
$
840

 
 
 
 
 
 
 
 
 
 
As of September 30, 2012
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
 
U. S. Stock/Bond Mutual Funds
$
13,187

 
$

 
$

 
$

 
$
13,187

NYMEX/ICE natural gas contracts
7,411

 
994

 

 
(8,405
)
 

NYMEX gasoline and heating
oil contracts
344

 

 

 
(344
)
 

Natural gas commodity contracts

 
3,060

 
113

 
(299
)
 
2,874

Total
$
20,942

 
$
4,054

 
$
113

 
$
(9,048
)
 
$
16,061

Liabilities
 
 
 
 
 
 
 
 
 
NYMEX/ICE natural gas contracts
$
12,253

 
$
1,891

 
$

 
$
(14,144
)
 
$

Natural gas commodity contracts

 
428

 
4

 
(299
)
 
133

Total
$
12,253

 
$
2,319

 
$
4

 
$
(14,443
)
 
$
133

 
 
 
 
 
 
 
 
 
 
As of June 30, 2012
 

 
 

 
 

 
 

 
 

Assets
 

 
 

 
 

 
 

 
 

U. S. Stock/Bond Mutual Funds
$
17,535

 
$

 
$

 
$

 
$
17,535

NYMEX/ICE natural gas contracts
3,273

 
1,240

 

 
(4,513
)
 

NYMEX gasoline and heating
oil contracts
107

 

 

 
(107
)
 

Natural gas commodity contracts

 
4,288

 
107

 
(516
)
 
3,879

Total
$
20,915

 
$
5,528

 
$
107

 
$
(5,136
)
 
$
21,414

Liabilities
 

 
 

 
 

 
 

 
 

NYMEX/ICE natural gas contracts
$
22,141

 
$
1,590

 
$

 
$
(23,731
)
 
$

Natural gas commodity contracts

 
587

 

 
(516
)
 
71

Total
$
22,141

 
$
2,177

 
$

 
$
(24,247
)
 
$
71



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Table of Contents

The mutual funds included in Level 1 are valued based on exchange-quoted market prices of identical securities. Derivative instruments included in Level 1 are valued using quoted market prices on the New York Mercantile Exchange (NYMEX). Derivative instruments classified in Level 2 include physical commodity derivatives that are valued using broker or dealer quotation services whose prices are derived principally from, or are corroborated by, observable market inputs. Also included in Level 2 are certain derivative instruments that have values that are similar to, and correlate with, quoted prices for exchange-traded instruments in active markets. Derivative instruments included in Level 3 are valued using generally unobservable inputs that are based upon the best information available and reflect management’s assumptions about how market participants would price the asset or liability. The Company’s policy is to recognize transfers between the levels of the fair value hierarchy, if any, as of the beginning of the interim reporting period in which circumstances change or events occur to cause the transfer. The following is a reconciliation of the Level 3 beginning and ending net derivative balances:

 
Three Months Ended June 30,
 
Nine Months Ended June 30,
(Thousands)
2013
 
2012
 
2013
 
2012
Beginning of period
$
93

 
$
58

 
$
109

 
$
13

Net settlements
33

 
(9
)
 
4

 
(16
)
Net losses related to derivatives not held
  at end of period
(9
)
 
(8
)
 
(99
)
 
(68
)
Net gains related to derivatives still held
  at end of period
255

 
66

 
358

 
178

End of period
$
372

 
$
107

 
$
372

 
$
107


The mutual funds are included in the Other investments line of the Consolidated Balance Sheets. Derivative assets and liabilities, including receivables and payables associated with cash margin requirements, are presented net in the Consolidated Balance Sheets when a legally enforceable netting agreement exists between the Company and the counterparty to a derivative contract. For additional information on derivative instruments, see Note 8, Derivative Instruments and Hedging Activities.

8.        DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

Laclede Gas has a risk management policy that allows for the purchase of natural gas derivative instruments with the goal of managing price risk associated with purchasing natural gas on behalf of its customers. This policy prohibits speculation and permits the Utility to hedge up to 70% of its normal volumes purchased for up to a 36-month period. Costs and cost reductions, including carrying costs, associated with the Utility’s use of natural gas derivative instruments are allowed to be passed on to the Utility’s customers through the operation of its Purchased Gas Adjustment (PGA) Clause, through which the MoPSC allows the Utility to recover gas supply costs, subject to prudence review by the MoPSC. Accordingly, Laclede Gas does not expect any adverse earnings impact as a result of the use of these derivative instruments. The Utility does not designate these instruments as hedging instruments for financial reporting purposes because gains or losses associated with the use of these derivative instruments are deferred and recorded as regulatory assets or regulatory liabilities pursuant to ASC Topic 980, “Regulated Operations,” and, as a result, have no direct impact on the Statements of Consolidated Income. The timing of the operation of the PGA Clause may cause interim variations in short-term cash flows, because the Utility is subject to cash margin requirements associated with changes in the values of these instruments. Nevertheless, carrying costs associated with such requirements are recovered through the PGA Clause.
From time to time, Laclede Gas purchases NYMEX futures and options contracts to help stabilize operating costs associated with forecasted purchases of gasoline and diesel fuels used to power vehicles and equipment used in the course of its business. At June 30, 2013, Laclede Gas held 0.4 million gallons of gasoline futures contracts at an average price of $2.25 per gallon. Most of these contracts, the longest of which extends to April 2014, are designated as cash flow hedges of forecasted transactions pursuant to ASC Topic 815. The gains or losses on these derivative instruments are not subject to the Utility’s PGA Clause.

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Table of Contents


In the course of its business, Laclede Group’s gas marketing subsidiary, LER, which includes its wholly owned subsidiary LER Storage Services, Inc., enters into commitments associated with the purchase or sale of natural gas. Certain of LER’s derivative natural gas contracts are designated as normal purchases or normal sales and, as such, are excluded from the scope of ASC Topic 815 and are accounted for as executory contracts on an accrual basis. Any of LER’s derivative natural gas contracts that are not designated as normal purchases or normal sales are accounted for at fair value. At June 30, 2013, the fair values of 57.7 million MMBtu of non-exchange traded natural gas commodity contracts were reflected in the Consolidated Balance Sheet. Of these contracts, 34.3 million MMBtu will settle during fiscal year 2013, 21.6 million MMBtu will settle during fiscal year 2014, while the remaining 1.8 million MMBtu will settle during fiscal year 2015. These contracts have not been designated as hedges; therefore, changes in the fair value of these contracts are reported in earnings each period. Furthermore, LER manages the price risk associated with its fixed-priced commitments by either closely matching the offsetting physical purchase or sale of natural gas at fixed prices or through the use of NYMEX or Ice Clear Europe (ICE) futures, swap, and option contracts to lock in margins. At June 30, 2013, LER’s unmatched fixed-price positions were not material to Laclede Group’s financial position or results of operations. LER’s NYMEX and ICE natural gas futures, swap, and option contracts used to lock in margins may be designated as cash flow hedges of forecasted transactions for financial reporting purposes.
The Company’s exchange-traded/cleared derivative instruments consist primarily of NYMEX and ICE positions. The NYMEX is the primary national commodities exchange on which natural gas derivatives are traded. Open NYMEX/ICE natural gas futures and swap positions at June 30, 2013 were as follows:
 
Laclede Gas Company
 
Laclede Energy
Resources, Inc.
 
MMBtu
(millions)
 
Avg. Price
Per
MMBtu
 
MMBtu
(millions)
 
Avg. Price
Per
MMBtu
Open short futures positions
 
 
 
 
 
 
 
Fiscal 2013

 
$

 
5.00

 
$
4.03

Fiscal 2014

 

 
6.04

 
3.84

Fiscal 2015

 

 
0.28

 
4.18

Open long futures positions
 
 
 
 
 
 
 
Fiscal 2013
3.42

 
$
3.42

 
0.63

 
$
3.82

Fiscal 2014
4.87

 
3.97

 
0.01

 
4.03

Fiscal 2015

 

 
2.42

 
3.91


At June 30, 2013, Laclede Gas had 17.0 million MMBtu of other price mitigation in place through the use of NYMEX natural gas option-based strategies while LER had none.
In February 2013, Laclede Group entered into certain interest rate swap agreements to effectively lock in interest rates on a portion of the long-term debt it anticipates issuing to finance its pending acquisition of Missouri Gas Energy (MGE). These derivative instruments have been designated as cash flow hedges of forecasted transactions. These forward starting swaps involve the payment of a fixed interest rate and the receipt of a floating interest rate (the London Interbank Offered Rate, also known as LIBOR) over the terms specified in the contracts. At June 30, 2013, the notional amount of interest rate swaps outstanding was $355 million with stated maturities ranging from 2018 to 2043 and fixed interest rates ranging between 1.28% and 3.14%.
Derivative instruments designated as cash flow hedges of forecasted transactions are recognized on the Consolidated Balance Sheets at fair value and the change in the fair value of the effective portion of these hedge instruments is recorded, net of tax, in other comprehensive income (OCI). Accumulated other comprehensive income (AOCI) is a component of Total Common Stock Equity. Amounts are reclassified from AOCI into earnings when the hedged items affect net income, using the same revenue or expense category that the hedged item impacts. Based on market prices at June 30, 2013, it is expected that approximately $5.3 million of pre-tax unrealized gains will be reclassified into the Statements of Consolidated Income during the next twelve months. Cash flows from hedging transactions are classified in the same category as the cash flows from the items that are being hedged in the Statements of Consolidated Cash Flows.


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Table of Contents

The Effect of Derivative Instruments on the Statements of Consolidated Income and Statements of Consolidated Comprehensive Income
 
 
Three Months Ended
 
Nine Months Ended
 
Location of Gain (Loss)
June 30,
 
June 30,
(Thousands)
Recorded in Income
2013
 
2012
 
2013
 
2012
Derivatives in Cash Flow Hedging Relationships
 
 
 
 
 
 
 
Effective portion of gain (loss) recognized in OCI on derivatives:
 
 
 
 
 
 
 
NYMEX/ICE natural gas contracts
 
$
5,501

 
$
(1,802
)
 
$
3,646

 
$
6,218

NYMEX gasoline and heating oil contracts
 
(125
)
 
69

 
79

 
202

      Interest rate swaps
 
22,238

 

 
17,689

 

Total
 
$
27,614

 
$
(1,733
)
 
$
21,414

 
$
6,420

Effective portion of gain (loss) reclassified from AOCI to income:
 
 
 
 
 
 
 
NYMEX/ICE natural gas contracts
Gas Marketing Operating Revenues
$
(1,570
)
 
$
7,646

 
$
(3,229
)
 
$
18,434

 
Gas Marketing Operating Expenses
199

 
(1,492
)
 
(453
)
 
(9,861
)
Sub-total
 
(1,371
)
 
6,154

 
(3,682
)
 
8,573

NYMEX gasoline and heating oil contracts
Gas Utility Other Operations and Maintenance Expenses
53

 
17

 
138

 
20

Total
 
$
(1,318
)
 
$
6,171

 
$
(3,544
)
 
$
8,593

Ineffective portion of gain (loss) on derivatives recognized in income:
 
 
 
 
 
 
 
NYMEX/ICE natural gas contracts
Gas Marketing Operating Revenues
$
16

 
$
(84
)
 
$
(396
)
 
$
(15
)
 
Gas Marketing Operating Expenses
(22
)
 
(95
)
 
(151
)
 
(291
)
Sub-total
 
(6
)
 
(179
)
 
(547
)
 
(306
)
NYMEX gasoline and heating oil contracts
Gas Utility Other Operations and Maintenance Expenses
5

 
(46
)
 
(127
)
 
(12
)
Total
 
$
(1
)
 
$
(225
)
 
$
(674
)
 
$
(318
)
 
 
 
 
 
 
 
 
 
Derivatives Not Designated as Hedging Instruments *
 
 
 
 
 
 
 
Gain (loss) recognized in income on derivatives:
 
 
 
 
 
 
 
Natural gas commodity contracts
Gas Marketing Operating Revenues
$
(993
)
 
$
2,641

 
$
(218
)
 
$
3,431

 
Gas Marketing Operating Expenses

 

 

 
687

NYMEX/ICE natural gas contracts
Gas Marketing Operating Revenues
1,163

 
(1,123
)
 
551

 
425

 
Gas Marketing Operating Expenses

 
(655
)
 

 
(625
)
NYMEX gasoline and heating oil contracts
Other Income and (Income Deductions) - Net
(5
)
 
(11
)
 
41

 
2

Total
 
$
165

 
$
852

 
$
374

 
$
3,920


*
Gains and losses on Laclede Gas’ natural gas derivative instruments, which are not designated as hedging instruments for financial reporting purposes, are deferred pursuant to the Utility’s PGA Clause and initially recorded as regulatory assets or regulatory liabilities. These gains and losses are excluded from the table above because they have no direct impact on the Statements of Consolidated Income. Such amounts are recognized in the Statements of Consolidated Income as a component of Gas Utility Natural and Propane Gas operating expenses when they are recovered through the PGA Clause and reflected in customer billings.


18

Table of Contents

Fair Value of Derivative Instruments in the Consolidated Balance Sheet at June 30, 2013
 
 
Asset Derivatives
 
Liability Derivatives
 
(Thousands)
Balance Sheet Location
Fair
Value
*
Balance Sheet Location
Fair
 Value
*
Derivatives designated as hedging instruments
 
 
 
 
 
NYMEX/ICE natural gas contracts
Derivative Instrument Assets
$
4,574

 
Derivative Instrument Assets
$
437

 
   NYMEX/ICE natural gas contracts
Other Deferred Charges
77

 
Other Deferred Charges
9

 
NYMEX gasoline and heating oil contracts
Accounts Receivable – Other
136

 
Accounts Receivable – Other

 
Interest rate swaps
Derivative Instrument Assets
17,689

 
Derivative Instrument Assets

 
Sub-total
 
22,476

 
 
446

 
Derivatives not designated as hedging instruments
 
 
 
 
 
NYMEX/ICE natural gas contracts
Derivative Instrument Assets
859

 
Derivative Instrument Assets
146

 
 
Accounts Receivable – Other
1,956

 
Accounts Receivable – Other
3,688

 
Natural gas commodity contracts
Derivative Instrument Assets
944

 
Derivative Instrument Assets
89

 
 
Other Deferred Charges
14

 
Other Deferred Charges

 
 
Other Current Liabilities
122

 
Other Current Liabilities
836

 
 
Other Deferred Credits
33

 
Other Deferred Credits
159

 
Sub-total
 
3,928

 
 
4,918

 
Total derivatives
 
$
26,404

 
 
$
5,364

 
 
 
 
 
 
 
 
Fair Value of Derivative Instruments in the Consolidated Balance Sheet at September 30, 2012
 
 
Asset Derivatives
 
Liability Derivatives
 
(Thousands)
Balance Sheet Location
Fair
Value
*
Balance Sheet Location
Fair
Value
*
Derivatives designated as hedging instruments
 
 
 
 
 
NYMEX/ICE natural gas contracts
Accounts Receivable - Other
$
405

 
Accounts Receivable - Other
$
3,413

 
NYMEX gasoline and heating oil contracts
Accounts Receivable - Other
334

 
Accounts Receivable - Other

 
Sub-total
 
739

 
 
3,413

 
Derivatives not designated as hedging instruments
 
 
 
 
 
NYMEX/ICE natural gas contracts
Accounts Receivable - Other
8,000

 
Accounts Receivable - Other
10,731

 
Natural gas commodity contracts
Derivative Instrument Assets
3,150

 
Derivative Instrument Assets
295

 
 
Other Current Liabilities
4

 
Other Current Liabilities
137