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SPIRE INC 10-Q 2017
Document

 
 
 
 
 

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

FORM 10-Q
(Mark One)
[ X ]
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended
December 31, 2016
 
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
 
Name of Registrant, Address of Principal Executive Offices and Telephone Number
 
State of Incorporation
 
I.R.S. Employer Identification Number
1-16681
 
Spire Inc.
700 Market Street
St. Louis, MO 63101
314-342-0500
 
Missouri
 
74-2976504
1-1822
 
Laclede Gas Company
700 Market Street
St. Louis, MO 63101
314-342-0500
 
Missouri
 
43-0368139
2-38960
 
Alabama Gas Corporation
2101 6th Avenue North
Birmingham, Alabama 35203
205-326-8100
 
Alabama
 
63-0022000

Indicate by check mark whether each 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.
Spire Inc.
 
Yes [ X ]
 
No [ ]
Laclede Gas Company
 
Yes [ X ]
 
No [ ]
Alabama Gas Corporation
 
Yes [ X ]
 
No [ ]

Indicate by check mark whether each registrant 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).
Spire Inc.
 
Yes [ X ]
 
No [ ]
Laclede Gas Company
 
Yes [ X ]
 
No [ ]
Alabama Gas Corporation
 
Yes [ X ]
 
No [ ]

Indicate by check mark whether the registrant 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
 
Accelerated
filer
 
Non-
accelerated filer
 
Smaller
reporting company
Spire Inc.
X
 
 
 
 
 
 
Laclede Gas Company
 
 
 
 
X
 
 
Alabama Gas Corporation
 
 
 
 
X
 
 

Indicate by check mark whether each registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Spire Inc.
 
Yes [ ]
 
No [ X ]
Laclede Gas Company
 
Yes [ ]
 
No [ X ]
Alabama Gas Corporation
 
Yes [ ]
 
No [ X ]

The number of shares outstanding of each registrant’s common stock as of January 30, 2017 was as follows:
Spire Inc.
 
Common Stock, par value $1.00 per share
 
45,738,897

Laclede Gas Company
 
Common Stock, par value $1.00 per share (all owned by Spire Inc.)
 
24,577

Alabama Gas Corporation
 
Common Stock, par value $0.01 per share (all owned by Spire Inc.)
 
1,972,052


Laclede Gas Company and Alabama Gas Corporation meet the conditions set forth in General Instructions H(1)(a) and (b) to Form 10-Q and are therefore filing this Form 10-Q with the reduced disclosure format specified in General Instructions H(2) to Form 10-Q.

This combined Form 10-Q represents separate filings by Spire Inc., Laclede Gas Company and Alabama Gas Corporation. Information contained herein relating to an individual registrant is filed by that registrant on its own behalf. Each registrant makes no representation as to information relating to the other registrants, except that information relating to Laclede Gas Company and Alabama Gas Corporation are also attributed to Spire Inc.
 
 
 
 
 



TABLE OF CONTENTS
Page No.
 
 
 
 
 
 
 
 
 
 
 
 
 
Spire Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Laclede Gas Company
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Alabama Gas Corporation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to Financial Statements
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

1




GLOSSARY OF KEY TERMS AND ABBREVIATIONS
Alabama Utilities
Alagasco and Mobile Gas, the utilities serving the Alabama region
 
Laclede Gas
Laclede Gas Company, or Missouri Utilities
Alagasco
Alabama Gas Corporation
 
MDNR
Missouri Department of Natural Resources
AOCI
Accumulated other comprehensive income or loss
 
MGE
Missouri Gas Energy
APSC
Alabama Public Service Commission
 
MGP
Manufactured gas plant
ASC
Accounting Standards Codification
 
Missouri Utilities
Laclede Gas Company (including MGE), the utilities serving the Missouri region
ASU
Accounting Standards Update
 
MMBtu
Million British thermal units
Bcf
Billion cubic feet
 
Mobile Gas
Mobile Gas Service Corporation
BVCP
Brownfields/Voluntary Cleanup Program
 
MoPSC
Missouri Public Service Commission
CERCLA
Comprehensive Environmental Response, Compensation, and Liability Act of 1980
 
MSPSC
Mississippi Public Service Commission
Degree days
The average of a day’s high and low temperature below 65, subtracted from 65, multiplied by the number of days impacted
 
NYSE
New York Stock Exchange
EnergySouth
EnergySouth, Inc.
 
NYMEX
New York Mercantile Exchange, Inc.
EPA
US Environmental Protection Agency
 
OPC
Missouri Office of the Public Counsel
EPS
Earnings per share
 
OTCBB
Over-the-Counter Bulletin Board
FASB
Financial Accounting Standards Board
 
PGA
Purchased Gas Adjustment
FERC
Federal Energy Regulatory Commission
 
PRP
Potentially responsible party
GAAP
Accounting principles generally accepted in the United States of America
 
RSE
Rate Stabilization and Equalization
Gas Marketing
Operating segment including Spire Marketing, which is engaged in the non-regulated marketing of natural gas and related activities
 
SEC
US Securities and Exchange Commission
Gas Utility
Segment including the regulated operations of the Utilities
 
Spire Marketing
Spire Marketing Inc. (formerly known as Laclede Energy Resources, Inc., or LER)
GSA
Gas Supply Adjustment
 
US
United States
ICE
Intercontinental Exchange
 
Utilities
Laclede Gas Company, Alabama Gas Corporation, and the subsidiaries of EnergySouth, Inc.
ISRS
Infrastructure System Replacement
Surcharge
 
Willmut Gas
Willmut Gas & Oil Company
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

2




PART I. FINANCIAL INFORMATION
The interim financial statements included herein have been prepared by three separate registrants — Spire Inc. (Spire or the Company), Laclede Gas Company (Laclede Gas or Missouri Utilities) and Alabama Gas Corporation (Alagasco or Alabama Utility) — 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 each registrant’s respective Form 10-K for the fiscal year ended September 30, 2016.
The Financial Information in this Part I includes separate financial statements (i.e., balance sheets, statements of income and comprehensive income, statements of common shareholders’ equity and statements of cash flows) for Spire, Laclede Gas and Alagasco. The Notes to Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations are also included and presented herein on a combined basis for Spire, Laclede Gas and Alagasco.

3




Item 1. Financial Statements

SPIRE INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)

 
Three Months Ended December 31,
(In millions, except per share amounts)
2016
 
2015
Operating Revenues:
 
 
 
Gas Utility
$
472.3

 
$
398.8

Gas Marketing and other
22.8

 
0.6

Total Operating Revenues
495.1

 
399.4

Operating Expenses:
 
 
 
Gas Utility
 
 
 
Natural and propane gas
193.8

 
148.5

Other operation and maintenance expenses
99.4

 
91.6

Depreciation and amortization
37.7

 
33.5

Taxes, other than income taxes
33.4

 
28.2

Total Gas Utility Operating Expenses
364.3

 
301.8

Gas Marketing and other
41.7

 
10.6

Total Operating Expenses
406.0

 
312.4

Operating Income
89.1

 
87.0

Other Income
0.5

 
1.4

Interest Charges:
 
 
 
Interest on long-term debt
19.1

 
16.9

Other interest charges
3.0

 
2.1

Total Interest Charges
22.1

 
19.0

Income Before Income Taxes
67.5

 
69.4

Income Tax Expense
22.3

 
22.5

Net Income
$
45.2

 
$
46.9

 
 
 
 
Weighted Average Number of Common Shares Outstanding:
 
 
 
Basic
45.5

 
43.2

Diluted
45.7

 
43.4

Basic Earnings Per Share of Common Stock
$
0.99

 
$
1.08

Diluted Earnings Per Share of Common Stock
$
0.99

 
$
1.08

Dividends Declared Per Share of Common Stock
$
0.53

 
$
0.49

 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 


4




SPIRE INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)

 
Three Months Ended December 31,
(In millions)
2016
 
2015
Net Income
$
45.2

 
$
46.9

Other Comprehensive (Loss) Income, Before Tax:
 
 
 
Cash flow hedging derivative instruments:
 
 
 
Net hedging gains (losses) arising during the period
11.5

 
(0.7
)
Reclassification adjustment for losses included in net income
0.2

 
1.2

Net unrealized gains on cash flow hedging derivative instruments
11.7

 
0.5

Net gains on defined benefit pension and other postretirement plans
0.1

 
0.1

Net unrealized losses on available for sale securities
(0.1
)
 
(0.1
)
Other Comprehensive Income, Before Tax
11.7

 
0.5

Income Tax Expense Related to Items of Other Comprehensive Income
4.3

 
0.2

Other Comprehensive Income, Net of Tax
7.4

 
0.3

Comprehensive Income
$
52.6

 
$
47.2

 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 


5




SPIRE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

 
December 31,
 
September 30,
 
December 31,
(Dollars in millions, except per share amounts)
2016
 
2016
 
2015
ASSETS
Utility Plant
$
4,893.2

 
$
4,793.6

 
$
4,220.6

Less: Accumulated depreciation and amortization
1,561.4

 
1,506.4

 
1,267.3

Net Utility Plant
3,331.8

 
3,287.2

 
2,953.3

Non-utility Property (net of accumulated depreciation and amortization of $8.2, $8.1 and $7.7 at December 31, 2016, September 30, 2016, and December 31, 2015, respectively)
19.7

 
13.7

 
13.9

Goodwill
1,161.4

 
1,164.9

 
946.0

Other Investments
61.9

 
62.1

 
60.8

Total Other Property and Investments
1,243.0

 
1,240.7

 
1,020.7

Current Assets:
 
 
 
 
 
Cash and cash equivalents
10.6

 
5.2

 
4.6

Accounts receivable:
 
 
 
 
 
Utility
310.4

 
127.8

 
224.7

Other
133.4

 
113.4

 
85.5

Allowance for doubtful accounts
(21.1
)
 
(20.5
)
 
(12.7
)
Delayed customer billings
5.3

 
1.6

 
8.7

Inventories:
 
 
 
 
 
Natural gas
161.9

 
174.0

 
176.6

Propane gas
12.0

 
12.0

 
12.0

Materials and supplies
16.6

 
16.3

 
14.9

Natural gas receivable
8.4

 
9.7

 
20.1

Derivative instrument assets
18.7

 
11.4

 
4.3

Unamortized purchased gas adjustments
52.2

 
49.7

 
44.6

Other regulatory assets
82.3

 
44.2

 
31.7

Prepayments and other
24.9

 
24.8

 
21.0

Total Current Assets
815.6

 
569.6

 
636.0

Deferred Charges:
 
 
 
 
 
Regulatory assets
786.4

 
838.0

 
727.0

Other
133.3

 
128.9

 
61.8

Total Deferred Charges
919.7

 
966.9

 
788.8

Total Assets
$
6,310.1

 
$
6,064.4

 
$
5,398.8


6




SPIRE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)
(UNAUDITED)

 
December 31,
 
September 30,
 
December 31,
 
2016
 
2016
 
2015
CAPITALIZATION AND LIABILITIES
 
 
 
 
 
Capitalization:
 
 
 
 
 
Common stock (par value $1.00 per share; 70.0 million shares authorized; 45.7 million, 45.6 million, and 43.4 million shares issued and outstanding at December 31, 2016, September 30, 2016 and December 31, 2015, respectively)
$
45.7

 
$
45.6

 
$
43.4

Paid-in capital
1,175.7

 
1,175.9

 
1,038.7

Retained earnings
572.1

 
550.9

 
519.9

Accumulated other comprehensive income (loss)
3.2

 
(4.2
)
 
(1.7
)
Total Common Stock Equity
1,796.7

 
1,768.2

 
1,600.3

Long-term debt (less current portion)
1,821.3

 
1,820.7

 
1,838.9

Total Capitalization
3,618.0

 
3,588.9

 
3,439.2

Current Liabilities:
 
 
 
 
 
Current portion of long-term debt
250.0

 
250.0

 

Notes payable
506.4

 
398.7

 
377.1

Accounts payable
273.8

 
210.9

 
159.5

Advance customer billings
60.2

 
70.2

 
59.3

Wages and compensation accrued
29.6

 
39.8

 
25.4

Dividends payable
24.8

 
23.5

 
22.3

Customer deposits
35.7

 
34.9

 
33.0

Interest accrued
22.3

 
14.8

 
19.5

Taxes accrued
39.7

 
55.2

 
32.9

Deferred income taxes

 

 
7.4

Unamortized purchased gas adjustments
1.4

 
1.7

 
14.3

Other regulatory liabilities
42.8

 
28.9

 
41.5

Other
55.5

 
32.7

 
55.3

Total Current Liabilities
1,342.2

 
1,161.3

 
847.5

Deferred Credits and Other Liabilities:
 
 
 
 
 
Deferred income taxes
636.5

 
607.3

 
495.3

Pension and postretirement benefit costs
296.3

 
303.7

 
250.7

Asset retirement obligations
208.7

 
206.4

 
161.0

Regulatory liabilities
132.1

 
130.7

 
129.1

Other
76.3

 
66.1

 
76.0

Total Deferred Credits and Other Liabilities
1,349.9

 
1,314.2

 
1,112.1

Commitments and Contingencies (Note 10)

 

 

Total Capitalization and Liabilities
$
6,310.1

 
$
6,064.4

 
$
5,398.8

 
 
 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 
 
 


7




SPIRE INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMMON SHAREHOLDERS’ EQUITY
(UNAUDITED)

 
Common Stock Outstanding
 
Paid-in Capital
 
Retained Earnings
 
AOCI*
 
 
(Dollars in millions)
Shares
 
Amount
 
 
 
 
Total
Balance at September 30, 2015
43,335,012

 
$
43.3

 
$
1,038.1

 
$
494.2

 
$
(2.0
)
 
$
1,573.6

Net income

 

 

 
46.9

 

 
46.9

Dividend reinvestment plan
5,866

 

 
0.3

 

 

 
0.3

Stock-based compensation costs

 

 
1.7

 

 

 
1.7

Stock issued under stock-based compensation plans
106,306

 
0.1

 
0.2

 

 

 
0.3

Employee’s tax withholding for stock-based compensation
(29,083
)
 

 
(1.6
)
 

 

 
(1.6
)
Dividends declared

 

 

 
(21.2
)
 

 
(21.2
)
Other comprehensive income, net of tax

 

 

 

 
0.3

 
0.3

Balance at December 31, 2015
43,418,101

 
$
43.4

 
$
1,038.7

 
$
519.9

 
$
(1.7
)
 
$
1,600.3

 
 
 
 
 
 
 
 
 
 
 
 
Balance at September 30, 2016
45,650,642

 
$
45.6

 
$
1,175.9

 
$
550.9

 
$
(4.2
)
 
$
1,768.2

Net income

 

 

 
45.2

 

 
45.2

Dividend reinvestment plan
5,610

 

 
0.3

 

 

 
0.3

Stock-based compensation costs

 

 
1.7

 

 

 
1.7

Stock issued under stock-based compensation plans
110,136

 
0.1

 
(0.1
)
 

 

 

Employee’s tax withholding for stock-based compensation
(33,615
)
 

 
(2.1
)
 

 

 
(2.1
)
Dividends declared

 

 

 
(24.0
)
 

 
(24.0
)
Other comprehensive income, net of tax

 

 

 

 
7.4

 
7.4

Balance at December 31, 2016
45,732,773

 
$
45.7

 
$
1,175.7

 
$
572.1

 
$
3.2

 
$
1,796.7

 
 
 
 
 
 
 
 
 
 
 
 
* Accumulated other comprehensive income (loss)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


8




SPIRE INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
 
 
Three Months Ended December 31,
(In millions)
2016
 
2015
Operating Activities:
 
 
 
Net Income
$
45.2

 
$
46.9

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation, amortization, and accretion
37.8

 
33.7

Deferred income taxes and investment tax credits
22.1

 
22.4

Changes in assets and liabilities:
 
 
 
Accounts receivable
(186.8
)
 
(77.6
)
Unamortized purchased gas adjustments
(2.8
)
 
(45.7
)
Deferred purchased gas costs
7.9

 
12.6

Accounts payable
85.5

 
18.0

Delayed/advance customer billings – net
(13.7
)
 
8.9

Taxes accrued
(16.9
)
 
(18.8
)
Inventories
11.8

 
11.9

Other assets and liabilities
18.5

 
20.3

Other
1.7

 
0.9

Net cash provided by operating activities
10.3

 
33.5

Investing Activities:
 
 
 
Capital expenditures
(89.3
)
 
(62.4
)
Settlement for acquisition of EnergySouth
3.8

 

Other
(0.4
)
 
(0.4
)
Net cash used in investing activities
(85.9
)
 
(62.8
)
Financing Activities:
 
 
 
Issuance of long-term debt

 
80.0

Repayment of long-term debt

 
(80.0
)
Issuance of short-term debt - net
107.7

 
39.1

Issuance of common stock
0.1

 
1.1

Dividends paid
(22.8
)
 
(19.9
)
Other
(4.0
)
 
(0.2
)
Net cash provided by financing activities
81.0

 
20.1

Net Increase (Decrease) in Cash and Cash Equivalents
5.4

 
(9.2
)
Cash and Cash Equivalents at Beginning of Period
5.2

 
13.8

Cash and Cash Equivalents at End of Period
$
10.6

 
$
4.6

 
 
 
 
Supplemental disclosure of cash paid for:
 
 
 
Interest
$
(14.3
)
 
$
(12.9
)
Income taxes
(0.1
)
 
(0.1
)
 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 

9





LACLEDE GAS COMPANY
CONDENSED STATEMENTS OF INCOME
(UNAUDITED)

 
Three Months Ended December 31,
(In millions)
2016
 
2015
Operating Revenues:
 

 
 
Utility
$
363.6

 
$
317.2

Total Operating Revenues
363.6

 
317.2

Operating Expenses:
 
 
 
Utility
 
 
 
Natural and propane gas
191.3

 
149.8

Other operation and maintenance expenses
60.5

 
58.8

Depreciation and amortization
22.7

 
21.8

Taxes, other than income taxes
24.6

 
21.7

Total Operating Expenses
299.1

 
252.1

Operating Income
64.5

 
65.1

Other Income
0.1

 
0.8

Interest Charges:
 
 
 
Interest on long-term debt
8.3

 
8.4

Other interest charges
1.4

 
0.9

Total Interest Charges
9.7

 
9.3

Income Before Income Taxes
54.9

 
56.6

Income Tax Expense
16.9

 
17.2

Net Income
$
38.0

 
$
39.4

 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 


10




LACLEDE GAS COMPANY
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)

 
Three Months Ended December 31,
(In millions)
2016
 
2015
Net Income
$
38.0

 
$
39.4

Other Comprehensive Income (Loss), Before Tax:
 
 
 
Cash flow hedging derivative instruments:
 
 
 
Net hedging gains (losses) arising during the period
0.3

 
(0.1
)
Reclassification adjustment for losses included in net income

 
0.3

Net unrealized gains on cash flow hedging derivative instruments
0.3

 
0.2

Net (losses) gains on defined benefit pension and other postretirement plans
(0.1
)
 
0.1

Net unrealized gains (losses) on available for sale securities
0.1

 
(0.1
)
Other Comprehensive Income, Before Tax
0.3

 
0.2

Income Tax Expense Related to Items of Other Comprehensive Income
0.1

 
0.1

Other Comprehensive Income, Net of Tax
0.2

 
0.1

Comprehensive Income
$
38.2

 
$
39.5

 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 


11




LACLEDE GAS COMPANY
CONDENSED BALANCE SHEETS
(UNAUDITED)

 
December 31,
 
September 30,
 
December 31,
(Dollars in millions, except per share amounts)
2016
 
2016
 
2015
ASSETS
 
 
 
 
 
Utility Plant
$
2,794.7

 
$
2,718.5

 
$
2,580.6

Less: Accumulated depreciation and amortization
646.4

 
604.5

 
573.1

Net Utility Plant
2,148.3

 
2,114.0

 
2,007.5

Goodwill
210.2

 
210.2

 
210.2

Other Property and Investments
57.1

 
57.3

 
56.0

Total Other Property and Investments
267.3

 
267.5

 
266.2

Current Assets:
 
 
 
 
 
Cash and cash equivalents
4.0

 
2.1

 
1.3

Accounts receivable:
 
 
 
 
 
Utility
221.0

 
87.9

 
167.3

Other
12.2

 
11.4

 
24.6

Allowance for doubtful accounts
(17.1
)
 
(16.1
)
 
(8.7
)
Receivables from associated companies
5.3

 
2.2

 
4.6

Delayed customer billings
5.3

 
1.6

 
8.7

Inventories:
 
 
 
 
 
Natural gas
118.2

 
127.3

 
125.5

Propane gas
12.0

 
12.0

 
12.0

Materials and supplies
9.3

 
9.2

 
9.3

Derivative instrument assets
2.2

 
4.9

 

Unamortized purchased gas adjustments
33.8

 
43.1

 
44.6

Other regulatory assets
59.7

 
23.9

 
20.9

Prepayments and other
15.5

 
14.5

 
12.8

Total Current Assets
481.4

 
324.0

 
422.9

Deferred Charges:
 
 
 
 
 
Regulatory assets
543.4

 
589.8

 
563.9

Other
2.4

 
1.1

 
6.4

Total Deferred Charges
545.8

 
590.9

 
570.3

Total Assets
$
3,442.8

 
$
3,296.4

 
$
3,266.9

 
 
 


 
 

12




LACLEDE GAS COMPANY
CONDENSED BALANCE SHEETS (Continued)
(UNAUDITED)
 
 
December 31,
 
September 30,
 
December 31,
 
2016
 
2016
 
2015
CAPITALIZATION AND LIABILITIES
 
 
 
 
 
Capitalization:
 
 
 
 
 
Paid-in capital and common stock (par value $1.00 per share;
50,000 authorized; 24,577 shares issued and outstanding)
$
753.1

 
$
752.0

 
$
749.5

Retained earnings
341.6

 
318.3

 
309.4

Accumulated other comprehensive loss
(1.6
)
 
(1.8
)
 
(1.6
)
Total Common Stock Equity
1,093.1

 
1,068.5

 
1,057.3

Long-term debt 
804.3

 
804.1

 
803.6

Total Capitalization
1,897.4

 
1,872.6

 
1,860.9

Current Liabilities:
 
 
 
 
 
Notes payable
312.9

 
243.7

 
274.1

Accounts payable
104.3

 
67.6

 
64.6

Accounts payable – associated companies
9.4

 
5.4

 
4.5

Advance customer billings
38.8

 
49.1

 
36.8

Wages and compensation accrued
22.1

 
29.9

 
19.7

Dividends payable
14.7

 
14.0

 
21.2

Customer deposits
13.6

 
13.5

 
13.0

Interest accrued
9.5

 
7.7

 
9.4

Taxes accrued
16.4

 
29.1

 
10.2

Deferred income taxes

 

 
12.3

Regulatory liabilities
2.7

 
1.3

 
1.1

Other
35.2

 
9.9

 
37.9

Total Current Liabilities
579.6

 
471.2

 
504.8

Deferred Credits and Other Liabilities:
 
 
 
 
 
Deferred income taxes
578.2

 
556.9

 
493.5

Pension and postretirement benefit costs
202.8

 
211.8

 
204.2

Asset retirement obligations
76.1

 
75.2

 
73.3

Regulatory liabilities
67.3

 
67.3

 
81.4

Other
41.4

 
41.4

 
48.8

Total Deferred Credits and Other Liabilities
965.8

 
952.6

 
901.2

Commitments and Contingencies (Note 10)

 

 

Total Capitalization and Liabilities
$
3,442.8

 
$
3,296.4

 
$
3,266.9

 
 
 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 
 
 



13




LACLEDE GAS COMPANY
CONDENSED STATEMENTS OF COMMON SHAREHOLDER’S EQUITY
(UNAUDITED)

 
Common Stock Outstanding
 
Paid-in Capital
 
Retained Earnings
 
AOCI*
 
 
(Dollars in millions)
Shares
 
Amount
 
 
 
 
Total
Balance at September 30, 2015
24,577

 
$
0.1

 
$
748.2

 
$
291.2

 
$
(1.7
)
 
$
1,037.8

Net income

 

 

 
39.4

 

 
39.4

Stock-based compensation costs

 

 
1.2

 

 

 
1.2

Dividends declared

 

 

 
(21.2
)
 

 
(21.2
)
Other comprehensive income, net of tax

 

 

 

 
0.1

 
0.1

Balance at December 31, 2015
24,577

 
$
0.1

 
$
749.4

 
$
309.4

 
$
(1.6
)
 
$
1,057.3

 
 
 
 
 
 
 
 
 
 
 
 
Balance at September 30, 2016
24,577

 
$
0.1

 
$
751.9

 
$
318.3

 
$
(1.8
)
 
$
1,068.5

Net income

 

 

 
38.0

 

 
38.0

Stock-based compensation costs

 

 
1.1

 

 

 
1.1

Dividends declared

 

 

 
(14.7
)
 

 
(14.7
)
Other comprehensive income, net of tax

 

 

 

 
0.2

 
0.2

Balance at December 31, 2016
24,577

 
$
0.1

 
$
753.0

 
$
341.6

 
$
(1.6
)
 
$
1,093.1

 
 
 
 
 
 
 
 
 
 
 
 
* Accumulated other comprehensive income (loss)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 
 
 
 
 
 
 
 


14




LACLEDE GAS COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)

 
Three Months Ended December 31,
(In millions)
2016
 
2015
Operating Activities:
 
 
 
Net Income
$
38.0

 
$
39.4

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
22.7

 
21.8

Deferred income taxes and investment tax credits
16.9

 
17.2

Changes in assets and liabilities:
 
 
 
Accounts receivable
(136.0
)
 
(66.9
)
Unamortized purchased gas adjustments
9.3

 
(31.8
)
Deferred purchased gas costs
7.9

 
12.6

Accounts payable
50.3

 
8.6

Delayed/advance customer billings – net
(14.0
)
 
5.6

Taxes accrued
(12.6
)
 
(15.2
)
Inventories
9.0

 
12.6

Other assets and liabilities
16.7

 
17.7

Other
0.5

 
0.3

Net cash provided by operating activities
8.7

 
21.9

Investing Activities:
 
 
 
Capital expenditures
(61.2
)
 
(43.4
)
Other
0.1

 
(0.1
)
Net cash used in investing activities
(61.1
)
 
(43.5
)
Financing Activities:
 
 
 
Issuance of short-term debt
69.2

 
41.1

Dividends paid
(14.0
)
 
(19.9
)
Other
(0.9
)
 

Net cash provided by financing activities
54.3

 
21.2

Net Increase (Decrease) in Cash and Cash Equivalents
1.9

 
(0.4
)
Cash and Cash Equivalents at Beginning of Period
2.1

 
1.7

Cash and Cash Equivalents at End of Period
$
4.0

 
$
1.3

 
 
 
 
Supplemental disclosure of cash paid for:
 
 
 
Interest
$
(7.9
)
 
$
(4.1
)
Income taxes

 

 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 


15





ALABAMA GAS CORPORATION
CONDENSED STATEMENTS OF INCOME
(UNAUDITED)

 
Three Months Ended December 31,
(In millions)
2016
 
2015
Operating Revenues:
 

 
 
Utility
$
86.7

 
$
82.3

Total Operating Revenues
86.7

 
82.3

Operating Expenses:
 
 
 
Utility
 
 
 
Natural gas
16.8

 
12.1

Operation and maintenance
31.2

 
33.1

Depreciation and amortization
12.3

 
11.7

Taxes, other than income taxes
6.6

 
6.5

Total Operating Expenses
66.9

 
63.4

Operating Income
19.8

 
18.9

Other Income
0.4

 
0.5

Interest Charges:
 
 
 
Interest on long-term debt
2.8

 
3.0

Other interest charges
0.8

 
0.5

Total Interest Charges
3.6

 
3.5

Income Before Income Taxes
16.6

 
15.9

Income Tax Expense
6.3

 
6.0

Net Income
$
10.3

 
$
9.9

 
 
 
 
See the accompanying Notes to Financial Statements.
 
 
 


16




ALABAMA GAS CORPORATION
CONDENSED BALANCE SHEETS
(UNAUDITED)

 
December 31,
 
September 30,
 
December 31,
(Dollars in millions, except per share amounts)
2016
 
2016
 
2015
ASSETS
 
 
 
 
 
Utility Plant
$
1,750.2

 
$
1,729.6

 
$
1,640.0

Less: Accumulated depreciation and amortization
768.0

 
756.6

 
694.1

Net Utility Plant
982.2

 
973.0

 
945.9

Current Assets:
 
 
 
 
 
Cash and cash equivalents

 

 
0.1

Accounts receivable:
 
 
 
 
 
Utility
77.5

 
34.0

 
57.4

Other
6.1

 
7.2

 
5.9

Allowance for doubtful accounts
(2.4
)
 
(3.3
)
 
(4.0
)
Inventories:
 
 
 
 
 
Natural gas
28.4

 
34.6

 
40.0

Materials and supplies
6.1

 
5.9

 
5.4

Deferred income taxes

 

 
5.7

Unamortized purchased gas adjustments
17.1

 
5.6

 

Other regulatory assets
14.4

 
14.9

 
10.8

Prepayments and other
5.4

 
5.1

 
4.2

Total Current Assets
152.6

 
104.0

 
125.5

Deferred Charges: