10-Q

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 March 31, 2012

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 April 26, 2012, there were 22,486,766 shares of the registrant’s Common Stock, par value $1.00 per share, outstanding.

TABLE OF CONTENTS			Page No.
PART I.  FINANCIAL INFORMATION
Item 1	Financial Statements:
		Statements of Consolidated Income	4
		Statements of Consolidated Comprehensive Income	5
		Consolidated Balance Sheets	6-7
		Statements of Consolidated Cash Flows	8
		Notes to Consolidated Financial Statements	9-28
Item 2	Management’s Discussion and Analysis of Financial Condition and
		Results of Operations	29-45
Item 3	Quantitative and Qualitative Disclosures About Market Risk		46
Item 4	Controls and Procedures		46
PART II.  OTHER INFORMATION
Item 1	Legal Proceedings		47
Item 1A	Risk Factors		47
Item 5	Other Information		48
Item 6	Exhibits		48
SIGNATURE			49
INDEX TO EXHIBITS			50

2

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. 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, 2011.

3

Item 1. Financial Statements

THE LACLEDE GROUP, INC.

STATEMENTS OF CONSOLIDATED INCOME

 (UNAUDITED)

	Three Months Ended				Six Months Ended
	March 31,				March 31,
(Thousands, Except Per Share Amounts)		2012		2011		2012		2011
Operating Revenues:
Regulated Gas Distribution	$	298,620	$	388,375	$	549,522	$	665,818
Non-Regulated Gas Marketing		59,434		155,111		218,022		321,519
Other		121		292		1,544		643
Total Operating Revenues		358,175		543,778		769,088		987,980
Operating Expenses:
Regulated Gas Distribution
Natural and propane gas		171,164		260,706		317,915		434,071
Other operation expenses		38,043		39,500		75,608		74,362
Maintenance		5,761		6,441		11,069		12,581
Depreciation and amortization		10,175		9,739		20,264		19,377
Taxes, other than income taxes		20,093		24,686		34,760		40,434
Total Regulated Gas Distribution Operating Expenses		245,236		341,072		459,616		580,825
Non-Regulated Gas Marketing		61,805		152,302		214,364		315,655
Other		551		461		1,420		806
Total Operating Expenses		307,592		493,835		675,400		897,286
Operating Income		50,583		49,943		93,688		90,694
Other Income and (Income Deductions) – Net		1,381		467		3,320		2,312
Interest Charges:
Interest on long-term debt		5,740		5,740		11,479		11,682
Other interest charges		539		549		1,114		1,293
Total Interest Charges		6,279		6,289		12,593		12,975
Income Before Income Taxes		45,685		44,121		84,415		80,031
Income Tax Expense		16,001		16,228		29,557		28,769
Net Income	$	29,684	$	27,893	$	54,858	$	51,262
Weighted Average Number of Common Shares Outstanding:
Basic		22,254		22,100		22,223		22,070
Diluted		22,336		22,172		22,299		22,145
Basic Earnings Per Share of Common Stock	$	1.33	$	1.25	$	2.45	$	2.30
Diluted Earnings Per Share of Common Stock	$	1.32	$	1.25	$	2.45	$	2.30
Dividends Declared Per Share of Common Stock	$	0.415	$	0.405	$	0.830	$	0.810
See Notes to Consolidated Financial Statements.

4

THE LACLEDE GROUP, INC.

STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME

(UNAUDITED)

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)		2012			2011			2012			2011
Net Income	$	29,684		$	27,893		$	54,858		$	51,262
Other Comprehensive Income (Loss), Before Tax:
Net gains (losses) on cash flow hedging derivative instruments:
Net hedging gain arising during the period		5,106			960			8,153			1,174
Reclassification adjustment for losses (gains) included in
net income		408			(147	)		(2,422	)		(3,237	)
Net unrealized gains (losses) on cash flow hedging
derivative instruments		5,514			813			5,731			(2,063	)
Defined benefit pension and other postretirement plans:
Net actuarial loss arising during the period		(2,366	)		—			(2,366	)		—
Amortization of actuarial loss included in net periodic
pension and postretirement benefit cost		3,482			106			3,573			213
Net defined benefit pension and other postretirement plans		1,116			106			1,207			213
Other Comprehensive Income (Loss), Before Tax		6,630			919			6,938			(1,850	)
Income Tax Expense (Benefit) Related to Items of Other
Comprehensive Income (Loss)		2,561			355			2,680			(715	)
Other Comprehensive Income (Loss), Net of Tax		4,069			564			4,258			(1,135	)
Comprehensive Income	$	33,753		$	28,457		$	59,116		$	50,127
See Notes to Consolidated Financial Statements.

5

THE LACLEDE GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	March 31,			Sept. 30,			March 31,
(Thousands)	2012			2011			2011
ASSETS
Utility Plant	$	1,425,922		$	1,386,590		$	1,351,293
Less:  Accumulated depreciation and amortization		468,209			457,907			453,271
Net Utility Plant		957,713			928,683			898,022
Non-utility property		4,448			4,588			4,418
Other investments		54,688			50,785			53,485
Other Property and Investments		59,136			55,373			57,903
Current Assets:
Cash and cash equivalents		9,302			43,277			22,982
Accounts receivable:
Utility		100,015			71,090			146,821
Non-utility		34,915			50,894			43,079
Other		18,666			12,572			7,505
Allowance for doubtful accounts		(8,758	)		(10,073	)		(11,095	)
Delayed customer billings		13,464			—			32,398
Inventories:
Natural gas stored underground		57,456			115,170			40,225
Propane gas at FIFO cost		8,964			8,961			16,927
Materials and supplies at average cost		4,102			4,229			4,402
Natural gas receivable		16,351			30,689			18,183
Derivative instrument assets		5,297			7,759			10,491
Unamortized purchased gas adjustments		11,241			25,719			6,470
Deferred income taxes		—			—			7,310
Prepayments and other		6,795			8,847			5,437
Total Current Assets		277,810			369,134			351,135
Deferred Charges:
Regulatory assets		457,749			423,492			420,733
Other		5,723			6,400			6,624
Total Deferred Charges		463,472			429,892			427,357
Total Assets	$	1,758,131		$	1,783,082		$	1,734,417

6

THE LACLEDE GROUP, INC.

CONSOLIDATED BALANCE SHEETS (Continued)

(UNAUDITED)

	March 31,		Sept. 30,			March 31,
(Thousands, except share amounts)	2012		2011			2011
CAPITALIZATION AND LIABILITIES
Capitalization:
Common stock (70,000,000 shares authorized, 22,489,986,     22,430,734, and 22,400,309 shares issued, respectively)	$	22,490	$	22,431		$	22,400
Paid-in capital		165,056		163,702			160,152
Retained earnings		425,500		389,298			394,887
Accumulated other comprehensive income (loss)		2,158		(2,100	)		(8,272	)
Total Common Stock Equity		615,204		573,331			569,167
Long-term debt (less current portion) – Laclede Gas		339,386		364,357			364,327
Total Capitalization		954,590		937,688			933,494
Current Liabilities:
Notes payable		—		46,000			—
Accounts payable		73,045		96,561			96,808
Advance customer billings		—		15,230			—
Current portion of long-term debt		25,000		—			—
Wages and compensation accrued		13,873		13,650			13,504
Dividends payable		9,697		9,359			9,244
Customer deposits		9,459		10,048			10,719
Interest accrued		8,789		8,812			9,023
Taxes accrued		25,062		11,901			36,509
Deferred income taxes		6,615		8,405			—
Other		16,220		11,968			13,307
Total Current Liabilities		187,760		231,934			189,114
Deferred Credits and Other Liabilities:
Deferred income taxes		335,215		315,405			293,466
Unamortized investment tax credits		3,219		3,326			3,432
Pension and postretirement benefit costs		163,940		185,701			208,727
Asset retirement obligations		28,313		27,495			26,610
Regulatory liabilities		53,267		50,846			49,077
Other		31,827		30,687			30,497
Total Deferred Credits and Other Liabilities		615,781		613,460			611,809
Commitments and Contingencies (Note 11)
Total Capitalization and Liabilities	$	1,758,131	$	1,783,082		$	1,734,417
See Notes to Consolidated Financial Statements.

7

THE LACLEDE GROUP, INC.

STATEMENTS OF CONSOLIDATED CASH FLOWS

(UNAUDITED)

	Six Months Ended
	March 31,
(Thousands)	2012			2011
Operating Activities:
Net Income	$	54,858		$	51,262
Adjustments to reconcile net income to net cash provided by (used in)       operating activities:
Depreciation, amortization, and accretion		20,565			19,635
Deferred income taxes and investment tax credits		6,167			(9,012	)
Other – net		(744	)		71
Changes in assets and liabilities:
Accounts receivable – net		(20,355	)		(58,721	)
Unamortized purchased gas adjustments		14,478			17,248
Deferred purchased gas costs		(30,160	)		60,725
Accounts payable		(26,546	)		2,658
Delayed customer billings - net		(28,694	)		(49,207	)
Taxes accrued		12,575			25,997
Natural gas stored underground		57,714			73,351
Other assets and liabilities		11,601			5,987
Net cash provided by operating activities		71,459			139,994
Investing Activities:
Capital expenditures		(40,658	)		(29,746	)
Other investments		(1,440	)		(1,514	)
Net cash used in investing activities		(42,098	)		(31,260	)
Financing Activities:
Maturity of first mortgage bonds		—			(25,000	)
Repayment of short-term debt – net		(46,000	)		(129,650	)
Changes in book overdrafts		357			(291	)
Issuance of common stock		2,195			1,427
Non-employee directors’ restricted stock awards		(565	)		(494	)
Dividends paid		(18,314	)		(17,782	)
Employees’ taxes paid associated with restricted shares withheld upon vesting		(1,165	)		(1,162	)
Excess tax benefits from stock-based compensation		185			265
Other		(29	)		16
Net cash used in financing activities		(63,336	)		(172,671	)
Net Decrease in Cash and Cash Equivalents		(33,975	)		(63,937	)
Cash and Cash Equivalents at Beginning of Period		43,277			86,919
Cash and Cash Equivalents at End of Period	$	9,302		$	22,982
Supplemental Disclosure of Cash Paid During the Period for:
Interest	$	12,521		$	13,241
Income taxes		2,763			5,651
See Notes to Consolidated Financial Statements.

8

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 2011 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 flowsof 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 was formed in October 2011 and became operational on January 1, 2012.

BASIS OF CONSOLIDATION - The consolidated financial statements include the accounts of Laclede Group and its subsidiary companies. All subsidiaries are wholly owned. Laclede Gas and other subsidiaries of Laclede Group may engage in related party transactions during the ordinary course of business. All material intercompany balances have been eliminated from the consolidated financial statements of Laclede Group. These transactions include sales of natural gas from Laclede Gas to LER, sales of natural gas from LER to Laclede Gas, and transportation services provided by Laclede Pipeline Company to Laclede Gas. These revenues are shown on the Intersegment revenues lines in the table included in Note 10 under Regulated Gas Distribution, Non-Regulated Gas Marketing, and Other columns, respectively.

NATURAL GAS STORED UNDERGROUND – Inventory of Utility natural gas in storage is priced on a last-in, first-out (LIFO) basis. The carrying value of Utility inventory is not adjusted to the lower of cost or market prices because, pursuant to the Laclede Gas Purchased Gas Adjustment (PGA) Clause, actual gas costs are recovered in customer rates. Natural gas storage inventory in the Non-Regulated Gas Marketing operating segment is recorded at the lower of average cost or market.

REVENUE RECOGNITION - Laclede Gas reads meters and bills its customers on monthly cycles. The Utility records its regulated gas distribution 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 March 31, 2012 and 2011, for the Utility, were $13.0 million and $29.0 million, respectively. The amount of accrued unbilled revenue at September 30, 2011 was $11.8 million.

In the course of its business, LER 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, “Derivatives and Hedging.” As such, those contracts are accounted for as executory contracts and recorded on an accrual basis. Revenues and expenses from such contracts are recorded using a gross presentation. Contracts not designated as normal purchases or normal sales are recorded as derivatives with changes in fair value (representing unrealized gains and losses) recognized in earnings the periods prior to physical delivery. For additional information on derivative instruments, refer to Note 7, Derivative Instruments and Hedging Activities. Certain of LER’s wholesale purchase and sale transactions entered on or after January 1, 2012 are classified as trading activities for financial reporting purposes rather than elected for normal purchases or normal sales designations. Under generally accepted accounting principles (GAAP), revenues and expenses associated with trading activities are presented on a net basis in Non-Regulated Gas Marketing Operating Revenues in the Statements of Consolidated Income. This net presentation has no effect on operating income or net income.

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 Regulated Gas Distribution Operating Revenues for the quarters ended March 31, 2012 and 2011 were $15.5 million and $20.3 million, respectively. Amounts recorded in Regulated Gas Distribution Operating Revenues for the six months ended March 31, 2012 and 2011 were $25.7 million and $31.6 million, respectively. Gross receipts taxes are expensed by the Utility and included in the Taxes, other than income taxes line.

9

NEW ACCOUNTING STANDARDS – In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-04, “Amendments to Achieve Common Fair Value Measurement Disclosure Requirements in U.S. GAAP and IFRSs.” This ASU amends Accounting Standards Codification (ASC) Topic 820, “Fair Value Measurements and Disclosures,” to improve the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards (IFRS). The ASU does not change what items are measured at fair value, but instead makes various changes to the guidance pertaining to how fair value is measured. Additionally, the ASU sets forth additional disclosure requirements, including additional information about Level 3 fair value measurements. Many of the amendments in this ASU are changes to align the wording in U.S. GAAP with IFRS and, as such, are not intended to result in a change in the application of the guidance. The Company’s adoption of the guidance in this ASU on a prospective basis in the second quarter of fiscal year 2012 had no impact on its financial condition or results of operations, but certain additional disclosures have been presented as required.

In June 2011, the FASB issued 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, will not impact total net income, comprehensive income, or earnings per share.

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.

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 equity market exposure achieved through derivative instruments.

Pension costs for the quarters ended March 31, 2012 and 2011 were $7.6 million and $4.2 million, respectively, including amounts charged to construction. Pension costs for the six months ended March 31, 2012 and 2011 were $11.8 million and $5.8 million, respectively, including amounts charged to construction.

The net periodic pension costs include the following components:

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Service cost – benefits earned during the period	$	2,301		$	2,388		$	4,613		$	4,776
Interest cost on projected benefit obligation		4,840			4,705			9,711			9,410
Expected return on plan assets		(4,899	)		(4,712	)		(9,798	)		(9,424	)
Amortization of prior service cost		148			160			296			320
Amortization of actuarial loss		2,259			2,557			4,536			5,114
Loss on lump-sum settlement		3,407			—			3,407			—
Sub-total		8,056			5,098			12,765			10,196
Regulatory adjustment		(484	)		(862	)		(967	)		(4,395	)
Net pension cost	$	7,572		$	4,236		$	11,798		$	5,801

10

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 $6.4 million during the six months ended March 31, 2012. No lump-sum payments were recognized as settlements during the six months ended March 31, 2011.

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 $4.8 million effective August 1, 2007 and $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 2012 contributions to the pension plans through March 31, 2012 were $22.9 million to the qualified trusts and approximately $2.0 million to the non-qualified plans. Contributions to the pension plans for the remaining six months of fiscal year 2012 are anticipated to be at least $10.5 million to the qualified trusts and $4.7 million to the non-qualified plans.

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 March 31, 2012 and 2011 were $2.4 million, including amounts charged to construction. Postretirement benefit costs for the six months ended March 31, 2012 and 2011 were $4.8 million and $4.3 million, respectively, including amounts charged to construction.

Net periodic postretirement benefit costs consisted of the following components:

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Service cost – benefits earned during the period	$	2,015		$	1,919		$	4,030		$	3,838
Interest cost on accumulated
postretirement benefit obligation		1,380			1,211			2,760			2,422
Expected return on plan assets		(991	)		(912	)		(1,982	)		(1,823	)
Amortization of transition obligation		34			34			68			68
Amortization of prior service credit		(518	)		(582	)		(1,036	)		(1,164	)
Amortization of actuarial loss		1,065			1,111			2,130			2,221
Sub-total		2,985			2,781			5,970			5,562
Regulatory adjustment		(604	)		(400	)		(1,208	)		(1,271	)
Net postretirement benefit cost	$	2,381		$	2,381		$	4,762		$	4,291

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.

11

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 $7.6 million effective August 1, 2007 and $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 2012 contributions to the postretirement plans through March 31, 2012 were $3.0 million to the qualified trusts and approximately $0.1 million paid directly to participants from Laclede Gas’ funds. Contributions to the postretirement plans for the remaining six months of fiscal year 2012 are anticipated to be $9.0 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) and the Restricted Stock Plan for Non-Employee Directors. Refer to Note 3 of the Consolidated Financial Statements included in the Company’s Form 10-K for the fiscal year ended September 30, 2011 for descriptions of these plans. In January 2012, shareholders approved certain amendments to the 2006 Plan, including an amendment allowing members of the Company’s Board of Directors to participate in the 2006 Plan. Accordingly, effective February 1, 2012, no additional awards will be granted under the Restricted Stock Plan for Non-Employee Directors, as any such awards will be made pursuant to the 2006 Plan.

Restricted Stock Awards

During the six months ended March 31, 2012, the Company granted 101,963 performance-contingent restricted share units to executive officers and key employees at a weighted average grant date fair value of $36.55 per share. This number represents the maximum shares that can be earned pursuant to the terms of the awards. The share units have a performance period ending September 30, 2014. While the participants have no interim voting rights on these share units, dividends accrue during the performance period and are paid to the participants upon vesting, but are subject to forfeiture if the underlying shares units do not vest. The number of share 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.

Activity of restricted stock and restricted stock units subject to performance and/or market conditions during the six months ended March 31, 2012 is presented below:

			Weighted
			Average
	Shares/		Grant Date
	Units		Fair Value
Nonvested at September 30, 2011	259,075			$	34.29
Granted (maximum shares that can be earned)	101,963			$	36.55
Vested	(48,429	)		$	48.70
Forfeited	(79,072	)		$	38.43
Nonvested at March 31, 2012	233,537			$	30.88

During the six months ended March 31, 2012, the Company granted 30,075 shares of time-vested restricted stock to executive officers and key employees at a weighted average grant date fair value of $39.72 per share. These shares were awarded on December 1, 2011 and vest December 1, 2014. In the interim, participants receive full voting rights and dividends, which are not subject to forfeiture.

12

In January 2012, the Company granted 13,700 shares of time-vested restricted stock to non-employee directors at a weighted average grant date fair value of $41.36 per share. These shares were granted under the Restricted Stock Plan for Non-Employee Directors and vest depending on the participant’s age upon entering the plan and years of service as a director. The plan’s trustee acquires the shares for the awards in the open market and holds the shares as trustee for the benefit of the non-employee directors until the restrictions expire. In the interim, the participants receive full dividends and voting rights. As discussed above, effective February 1, 2012, any awards to non-employee directors will be made pursuant to The Laclede Group 2006 Equity Incentive Plan.

Time-vested restricted stock and time-vested restricted stock unit activity for the six months ended March 31, 2012 is presented below:

			Weighted
			Average
	Shares/		Grant Date
	Units		Fair Value
Nonvested at September 30, 2011	143,350			$	37.00
Granted	43,775			$	40.23
Vested	(54,400	)		$	41.48
Forfeited	(12,700	)		$	33.53
Nonvested at March 31, 2012	120,025			$	36.51

During the six months ended March 31, 2012, 88,129 shares of restricted stock and stock units (performance-contingent and time-vested), awarded on February 14, 2008 and November 5, 2008, vested. The Company withheld 29,157 of the vested shares at a weighted average price of $39.96 per share pursuant to elections by employees to satisfy tax withholding obligations.

Stock Option Awards

Stock option activity for the six months ended March 31, 2012 is presented below:

					Weighted
					Average
			Weighted		Remaining	Aggregate
			Average		Contractual	Intrinsic
	Stock		Exercise		Term	Value
	Options		Price		(Years)	($000)
Outstanding at September 30, 2011	305,875		$	30.72
Granted	—		$	—
Exercised	(43,625	)	$	30.63
Forfeited	—		$	—
Expired	—		$	—
Outstanding at March 31, 2012	262,250		$	30.74	2.8	$	2,172
Fully Vested and Expected to Vest   at March 31, 2012	262,250		$	30.74	2.8	$	2,172
Exercisable at March 31, 2012	262,250		$	30.74	2.8	$	2,172

The closing price of the Company’s common stock was $39.02 at March 31, 2012.

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Equity Compensation Costs

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

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Total equity compensation cost	$	684		$	822		$	1,351		$	1,540
Compensation cost capitalized		(221	)		(177	)		(359	)		(331	)
Compensation cost recognized in net income		463			645			992			1,209
Income tax benefit recognized in net income		(179	)		(248	)		(383	)		(466	)
Compensation cost recognized in net income,
net of income tax	$	284		$	397		$	609		$	743

As of March 31, 2012, there was $5.5 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 2.5 years.

4. EARNINGS PER COMMON SHARE

	Three Months Ended				Six Months Ended
	March 31,				March 31,
(Thousands, Except Per Share Amounts)		2012		2011		2012		2011
Basic EPS:
Net Income	$	29,684	$	27,893	$	54,858	$	51,262
Less: Income allocated to participating securities		167		226		324		430
Net Income Available to Common Shareholders	$	29,517	$	27,667	$	54,534	$	50,832
Weighted Average Shares Outstanding		22,254		22,100		22,223		22,070
Earnings Per Share of Common Stock	$	1.33	$	1.25	$	2.45	$	2.30
Diluted EPS:
Net Income	$	29,684	$	27,893	$	54,858	$	51,262
Less: Income allocated to participating securities		166		226		323		429
Net Income Available to Common Shareholders	$	29,518	$	27,667	$	54,535	$	50,833
Weighted Average Shares Outstanding		22,254		22,100		22,223		22,070
Dilutive Effect of Stock Options
and Restricted Stock		82		72		76		75
Weighted Average Diluted Shares		22,336		22,172		22,299		22,145
Earnings Per Share of Common Stock	$	1.32	$	1.25	$	2.45	$	2.30
Outstanding Shares Excluded from the
Calculation of Diluted EPS Attributable to:
Restricted stock and stock units subject to
performance and/or market conditions		203		193		203		193

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5. 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 (a)
(Thousands)	Carrying Amount		Fair Value		Quoted Prices in Active Markets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of March 31, 2012
Cash and cash equivalents	$	9,302	$	9,302	$	4,261	$	5,041	$	—
Short-term debt		—		—		—		—		—
Long-term debt, including current portion		364,386		432,098		—		432,098		—
As of September 30, 2011
Cash and cash equivalents	$	43,277	$	43,277
Short-term debt		46,000		46,000
Long-term debt		364,357		443,739
As of March 31, 2011
Cash and cash equivalents	$	22,982	$	22,982
Short-term debt		—		—
Long-term debt		364,327		391,877
(a) The Company adopted the provisions of ASU 2011-04 (ASC Topic 820) in the second quarter of fiscal year 2012 on a prospective basis. Accordingly, disclosures for prior periods are not required to be presented.

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 6, Fair Value Measurements, for information on financial instruments measured at fair value on a recurring basis.

15

6. 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 March 31, 2012
Assets
U. S. Stock/Bond Mutual Funds	$	17,907	$	—	$	—	$	—		$	17,907
NYMEX/ICE natural gas contracts		5,182		1,310		—		(4,881	)		1,611
NYMEX gasoline and heating
oil contracts		81		—		—		(81	)		—
Natural gas commodity contracts		—		4,362		79		(538	)		3,903
Total	$	23,170	$	5,672	$	79	$	(5,500	)	$	23,421
Liabilities
NYMEX/ICE natural gas contracts	$	37,811	$	2,342	$	—	$	(40,153	)	$	—
Natural gas commodity contracts		—		1,190		21		(538	)		673
Total	$	37,811	$	3,532	$	21	$	(40,691	)	$	673
As of September 30, 2011
Assets
U. S. Stock/Bond Mutual Funds	$	14,833	$	—	$	—	$	—		$	14,833
NYMEX/ICE natural gas contracts		4,856		—		—		1,975			6,831
NYMEX gasoline and heating
oil contracts		19		—		—		162			181
Natural gas commodity contracts		—		2,018		66		(108	)		1,976
Total	$	19,708	$	2,018	$	66	$	2,029		$	23,821
Liabilities
NYMEX/ICE natural gas contracts	$	20,928	$	—	$	—	$	(20,928	)	$	—
NYMEX gasoline and heating
oil contracts		124		—		—		(124	)		—
Natural gas commodity contracts		—		109		53		(108	)		54
Total	$	21,052	$	109	$	53	$	(21,160	)	$	54
As of March 31, 2011
Assets
U. S. Stock/Bond Mutual Funds	$	17,022	$	—	$	—	$	—		$	17,022
NYMEX/ICE natural gas contracts		5,718		—		—		4,416			10,134
NYMEX gasoline and heating
oil contracts		369		—		—		(38	)		331
Natural gas commodity contracts		—		930		57		(151	)		836
Total	$	23,109	$	930	$	57	$	4,227		$	28,323
Liabilities
NYMEX/ICE natural gas contracts	$	27,841	$	—	$	—	$	(27,841	)	$	—
Natural gas commodity contracts		—		313		33		(151	)		195
Total	$	27,841	$	313	$	33	$	(27,992	)	$	195

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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						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Beginning of period	$	37		$	76		$	13		$	23
Settlements		(41	)		(81	)		(7	)		(52	)
Net losses related to derivatives not held   at end of period		(1	)		(5	)		(4	)		(16	)
Net gains related to derivatives still held   at end of period		63			34			56			69
End of period	$	58		$	24		$	58		$	24

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 7, Derivative Instruments and Hedging Activities.

7. 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 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 March 31, 2012, Laclede Gas held 0.1 million gallons of gasoline futures contracts at an average price of $2.99 per gallon and 0.3 million gallons of gasoline options contracts. Most of these contracts, the longest of which extends to September 2012, 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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In the course of its business, Laclede Group’s non-regulated gas marketing subsidiary, Laclede Energy Resources, Inc. (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 March 31, 2012, the fair values of 88.6 million MMBtu of non-exchange traded natural gas commodity contracts were reflected in the Consolidated Balance Sheet. Of these contracts, 64.9 million MMBtu will settle during fiscal year 2012, while the remaining 23.7 million MMBtu will settle during fiscal year 2013. 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 March 31, 2012, 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.

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 March 31, 2012, it is expected that approximately $6.4 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.

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 March 31, 2012 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 2012	—	$	—	3.92	$	3.01
Fiscal 2013	—		—	6.78		3.29
Open long futures positions
Fiscal 2012	9.49	$	4.22	1.63	$	3.89
Fiscal 2013	21.86		4.16	1.43		3.90
Fiscal 2014	0.80		3.51	0.10		4.34

At March 31, 2012, Laclede Gas and LER also had 11.8 million MMBtu and 4.1 million MMBtu, respectively, of other price mitigation in place through the use of NYMEX natural gas option-based strategies.

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The Effect of Derivative Instruments on the Statements of Consolidated Income and Statements of Consolidated Comprehensive Income
		Three Months Ended						Six Months Ended
	Location of Gain (Loss)	March 31,						March 31,
(Thousands)	Recorded in Income		2012			2011			2012			2011
Derivatives in Cash Flow Hedging Relationships
Effective portion of gain recognized in OCI on derivatives:
NYMEX/ICE natural gas contracts		$	5,023		$	693		$	8,020		$	734
NYMEX gasoline and heating oil contracts			83			267			133			440
Total		$	5,106		$	960		$	8,153		$	1,174
Effective portion of gain (loss) reclassified from AOCI to income:
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues	$	4,048		$	757		$	10,788		$	5,591
	Non-Regulated Gas Marketing Operating Expenses		(4,445	)		(682	)		(8,369	)		(2,475	)
Sub-total			(397	)		75			2,419			3,116
NYMEX gasoline and heating oil contracts	Regulated Gas Distribution Other Operation Expenses		(11	)		72			3			121
Total		$	(408	)	$	147		$	2,422		$	3,237
Ineffective portion of gain (loss) on derivatives recognized in income:
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues	$	50		$	551		$	69		$	560
	Non-Regulated Gas Marketing Operating Expenses		(90	)		(498	)		(196	)		(623	)
Sub-total			(40	)		53			(127	)		(63	)
NYMEX gasoline and heating oil contracts	Regulated Gas Distribution Other Operation Expenses		28			19			34			48
Total		$	(12	)	$	72		$	(93	)	$	(15	)
Derivatives Not Designated as Hedging Instruments *
Gain (loss) recognized in income on derivatives:
Natural gas commodity contracts	Non-Regulated Gas Marketing Operating Revenues	$	1,557		$	143		$	790		$	(299	)
	Non-Regulated Gas Marketing Operating Expenses		—			746			687			1,196
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues		1,478			(42	)		1,548			(78	)
	Non-Regulated Gas Marketing Operating Expenses		30			—			30			—
NYMEX gasoline and heating oil contracts	Other Income and (Income Deductions) - Net		12			47			13			63
Total		$	3,077		$	894		$	3,068		$	882

* 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 Utility Natural and Propane Gas operating expenses when they are recovered through the PGA Clause and reflected in customer billings.

19

Fair Value of Derivative Instruments in the Consolidated Balance Sheet at March 31, 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	Derivative Instrument Assets	$	3,545		Derivative Instrument Assets	$	3,242
NYMEX gasoline and heating oil contracts	Accounts Receivable – Other		72		Accounts Receivable - Other		—
Sub-total			3,617				3,242
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Accounts Receivable - Other		709		Accounts Receivable - Other		36,437
	Derivative Instrument Assets		2,238		Derivative Instrument Assets		474
Natural gas commodity contracts	Derivative Instrument Assets		4,176		Derivative Instrument Assets		490
	Other Current Liabilities		48		Other Current Liabilities		721
	Other Deferred Charges		217		Other Deferred Charges		—
NYMEX gasoline and heating oil contracts	Accounts Receivable - Other		9		Accounts Receivable - Other		—
Sub-total			7,397				38,122
Total derivatives		$	11,014			$	41,364
Fair Value of Derivative Instruments in the Consolidated Balance Sheet at September 30, 2011
	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	$	4,395		Derivative Instrument Assets	$	4,105
	Other Deferred Charges		4		Other Deferred Charges		85
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		15		Derivative Instrument Assets		117
Sub-total			4,414				4,307
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Derivative Instrument Assets		457		Derivative Instrument Assets		16,330
	Other Deferred Charges		—		Other Deferred Charges		408
Natural gas commodity contracts	Derivative Instrument Assets		1,894		Derivative Instrument Assets		100
	Other Deferred Charges		183		Other Deferred Charges		—
	Other Current Liabilities		8		Other Current Liabilities		62
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		4		Derivative Instrument Assets		7
Sub-total			2,546				16,907
Total derivatives		$	6,960			$	21,214

20

Fair Value of Derivative Instruments in the Consolidated Balance Sheet at March 31, 2011
	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	$	688		Derivative Instrument Assets	$	10,926
	Other Deferred Charges		11		Other Deferred Charges		61
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		341		Derivative Instrument Assets		—
Sub-total			1,040				10,987
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Derivative Instrument Assets		4,353		Derivative Instrument Assets		16,854
	Other Deferred Charges		666		Other Deferred Charges		—
Natural gas commodity contracts	Derivative Instrument Assets		957		Derivative Instrument Assets		121
	Other Current Liabilities		30		Other Current Liabilities		225
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		28		Derivative Instrument Assets		—
Sub-total			6,034				17,200
Total derivatives		$	7,074			$	28,187

* The fair values of Asset Derivatives and Liability Derivatives exclude the fair value of cash margin receivables or payables with counterparties subject to netting arrangements. Fair value amounts of derivative contracts (including the fair value amounts of cash margin receivables and payables) for which there is a legal right to set off are presented net on the Consolidated Balance Sheets. As such, the gross balances presented in the table above are not indicative of the Company’s net economic exposure. Refer to Note 6, Fair Value Measurements, for information on the valuation of derivative instruments.

Following is a reconciliation of the amounts in the tables above to the amounts presented in the Consolidated Balance Sheets:

		March 31,			Sept. 30,			March 31,
	(Thousands)	2012			2011			2011
	Fair value of asset derivatives presented above	$	11,014		$	6,960		$	7,074
	Fair value of cash margin receivables offset with derivatives		35,648			23,188			32,258
	Netting of assets and liabilities with the same counterparty		(41,148	)		(21,160	)		(28,031	)
	Total	$	5,514		$	8,988		$	11,301
	Derivative Instrument Assets, per Consolidated Balance Sheets:
	Derivative instrument assets	$	5,297		$	7,759		$	10,491
	Other deferred charges		217			1,229			810
	Total	$	5,514		$	8,988		$	11,301
	Fair value of liability derivatives presented above	$	41,364		$	21,214		$	28,187
	Fair value of cash margin payables offset with derivatives		457			—			39
	Netting of assets and liabilities with the same counterparty		(41,148	)		(21,160	)		(28,031	)
	Derivative instrument liabilities, per Consolidated Balance Sheets*	$	673		$	54		$	195
*	Included in the Other line of the Current Liabilities section

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8. CONCENTRATIONS OF CREDIT RISK

A significant portion of LER’s transactions are with (or are associated with) energy producers, utility companies, and pipelines. These concentrations of transactions with these counterparties have the potential to affect the Company’s overall exposure to credit risk, either positively or negatively, in that each of these three groups may be affected similarly by changes in economic, industry, or other conditions. To manage this risk, as well as credit risk from significant counterparties in these and other industries, LER has established procedures to determine the creditworthiness of its counterparties. These procedures include obtaining credit ratings and credit reports, analyzing counterparty financial statements to assess financial condition, and considering the industry environment in which the counterparty operates. This information is monitored on an ongoing basis. In some instances, LER may require credit assurances such as prepayments, letters of credit, or parental guarantees. In addition, LER may enter into netting arrangements to mitigate credit risk with counterparties in the energy industry from which LER both sells and purchases natural gas. Sales are typically made on an unsecured credit basis with payment due the month following delivery. Accounts receivable amounts are closely monitored and provisions for uncollectible amounts are accrued when losses are probable. To date, losses have not been significant. LER records accounts receivable, accounts payable, and prepayments for physical sales and purchases of natural gas on a gross basis. The amount included in accounts receivable attributable to energy producers and their marketing affiliates amounted to $10.5 million at March 31, 2012. Net receivable amounts from these customers on the same date, reflecting netting arrangements, were $7.8 million. Accounts receivable attributable to utility companies and their marketing affiliates comprised $12.6 million of total accounts receivable at March 31, 2012, while net receivable amounts from these customers, reflecting netting arrangements, were $11.9 million. LER also has concentrations of credit risk with certain individually significant counterparties. At March 31, 2012, the amounts included in accounts receivable from LER’s five largest counterparties (in terms of net accounts receivable exposure), were $13.4 million. These five counterparties are either investment-grade rated or owned by investment-grade rated companies. Net receivable amounts from these customers on the same date, reflecting netting arrangements, were $11.4 million. Additionally, LER has concentrations of credit risk with pipeline companies associated with its natural gas receivable amounts.

9. OTHER INCOME AND (INCOME DEDUCTIONS) – NET

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012		2011
Interest income	$	316		$	267		$	664	$	715
Net investment gain		1,164			390			2,194		1,127
Other income		11			61			11		74
Other income deductions		(110	)		(251	)		451		396
Other Income and (Income Deductions) – Net	$	1,381		$	467		$	3,320	$	2,312

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10. INFORMATION BY OPERATING SEGMENT

All of Laclede Group’s subsidiaries are wholly owned. The Regulated Gas Distribution segment consists of the regulated operations of Laclede Gas and is the core business segment of Laclede Group. Laclede Gas is a public utility engaged in the retail distribution and sale of natural gas serving an area in eastern Missouri, with a population of approximately 2.2 million, including the City of St. Louis and parts of ten counties in eastern Missouri. The Non-Regulated Gas Marketing segment includes the results of LER, a subsidiary engaged in the non-regulated marketing of natural gas and related activities, and LER Storage Services, Inc., which was formed in October 2011 to utilize natural gas storage contracts for providing natural gas sales. Other includes Laclede Pipeline Company’s transportation of liquid propane regulated by the Federal Energy Regulatory Commission (FERC) as well as non-regulated activities, including real estate development, the compression of natural gas, and financial investments in other enterprises. These operations are conducted through five subsidiaries. Other also includes Laclede Gas’ non-regulated business activities, which are comprised of its non-regulated propane sales transactions and its propane storage and related services. Accounting policies are described in Note 1. Intersegment transactions include sales of natural gas from Laclede Gas to LER, sales of natural gas from LER to Laclede Gas, and transportation services provided by Laclede Pipeline Company to Laclede Gas. These revenues are shown on the Intersegment revenues lines in the table under Regulated Gas Distribution, Non-Regulated Gas Marketing, and Other columns, respectively.

Management evaluates the performance of the operating segments based on the computation of net economic earnings. Net economic earnings exclude from reported net income the after-tax impacts of net unrealized gains and losses and other timing differences associated with energy-related transactions. Net economic earnings will also exclude, if applicable, the after-tax impact of costs related to acquisition, divestiture, and restructuring activities.

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			Non-
	Regulated		Regulated
	Gas		Gas
(Thousands)	Distribution		Marketing		Other			Eliminations			Consolidated
Three Months Ended
March 31, 2012
Revenues from external customers	$	298,623	$	66,045	$	381		$	—		$	365,049
Intersegment revenues		—		1,927		259			(9,060	)		(6,874	)
Total Operating Revenues		298,623		67,972		640			(9,060	)		358,175
Net Economic Earnings		25,772		2,545		110			—			28,427
Total assets		1,680,948		177,129		151,646			(251,592	)		1,758,131
Six Months Ended
March 31, 2012
Revenues from external customers	$	549,522	$	218,022	$	1,544		$	—		$	769,088
Intersegment revenues		3		8,538		519			(9,060	)		—
Total Operating Revenues		549,525		226,560		2,063			(9,060	)		769,088
Net Economic Earnings		46,851		5,984		485			—			53,320
Total assets		1,680,948		177,129		151,646			(251,592	)		1,758,131
Three Months Ended
March 31, 2011
Revenues from external customers	$	387,737	$	151,305	$	33		$	—		$	539,075
Intersegment revenues		638		3,806		259			—			4,703
Total Operating Revenues		388,375		155,111		292			—			543,778
Net Economic Earnings (Losses)		26,203		1,335		(76	)		—			27,462
Total assets		1,634,674		165,403		130,172			(195,832	)		1,734,417
Six Months Ended
March 31, 2011
Revenues from external customers	$	664,242	$	309,006	$	124		$	—		$	973,372
Intersegment revenues		1,576		12,513		519			—			14,608
Total Operating Revenues		665,818		321,519		643			—			987,980
Net Economic Earnings (Losses)		47,637		3,281		(68	)		—			50,850
Total assets		1,634,674		165,403		130,172			(195,832	)		1,734,417

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Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income
	Three Months Ended					Six Months Ended
	March 31,					March 31,
(Thousands)	2012			2011		2012			2011
Total Net Economic Earnings above	$	28,427		$	27,462	$	53,320		$	50,850
Add: Unrealized gain on energy-related
derivative contracts, net of tax		1,963			431		2,244			412
Add:  Lower of cost or market inventory
adjustments, net of tax		(562	)		—		(562	)		—
Add:  Realized loss on economic hedges prior
to sale of the physical commodity, net of tax		(144	)		—		(144	)		—
Net Income	$	29,684		$	27,893	$	54,858		$	51,262

11. COMMITMENTS AND CONTINGENCIES

Commitments

Laclede Gas and LER have entered into various contracts, expiring on dates through 2017, for the storage, transportation, and supply of natural gas. Minimum payments required under the contracts in place at March 31, 2012 are estimated at approximately $394 million. Additional contracts are generally entered into prior to or during the heating season. Laclede Gas recovers its costs from customers in accordance with the PGA Clause.

During fiscal 2011, the Utility initiated a multi-year project to replace its existing work management, financial, and supply chain software applications to enhance its technology, customer service, and business processes. At March 31, 2012, the Company was contractually committed to costs of approximately $7 million related to this project, with additional expenditures to be incurred throughout the project’s life.

Guarantees

Laclede Group had guarantees totaling $86.3 million for performance and payment of certain gas supply transactions by LER, as of March 31, 2012. Since that date, total guarantees issued by Laclede Group on behalf of LER decreased by $2.0 million, bringing the total to $84.3 million in guarantees outstanding at April 27, 2012. No amounts have been recorded for these guarantees in the financial statements. As of March 31, 2012, management believes the probability is low that Laclede Group will be required to make payments under these guarantees.

Contingencies

Laclede Gas owns and operates natural gas distribution, transmission, and storage facilities, the operations of which are subject to various environmental laws, regulations, and interpretations. While environmental issues resulting from such operations arise in the ordinary course of business, such issues have not materially affected the Company’s or Laclede Gas’ financial position and results of operations. As environmental laws, regulations, and their interpretations change, however, Laclede Gas may be required to incur additional costs.

Similar to other natural gas utility companies, Laclede Gas faces the risk of incurring environmental liabilities. In the natural gas industry, these are typically associated with sites formerly owned or operated by gas distribution companies like Laclede Gas and/or its predecessor companies at which manufactured gas operations took place. At this time, Laclede Gas has identified three former manufactured gas plant (MGP) sites where costs have been incurred and claims have been asserted: one in Shrewsbury, Missouri and two in the City of St. Louis, Missouri.

With regard to the former MGP site located in Shrewsbury, Missouri, Laclede Gas and state and federal environmental regulators agreed upon certain remedial actions to a portion of the site in a 1999 Administrative Order on Consent (AOC), which actions have been completed. On September 22, 2008, EPA Region VII issued a letter of Termination and Satisfaction terminating the AOC. However, if after this termination of the AOC, regulators require additional remedial actions, or additional claims are asserted, Laclede Gas may incur additional costs.

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One of the sites located in the City of St. Louis is currently owned by a development agency of the City, which, together with other City development agencies, has selected a developer to redevelop the site. In conjunction with this redevelopment effort, Laclede Gas and another former owner of the site entered into an agreement (Remediation Agreement) with the City development agencies, the developer, and an environmental consultant that obligates one of the City agencies and the environmental consultant to remediate the site and obtain a No Further Action letter from the Missouri Department of Natural Resources. The Remediation Agreement also provides for a release of Laclede Gas and the other former site owner from certain liabilities related to the past and current environmental condition of the site and requires the developer and the environmental consultant to maintain certain insurance coverages, including remediation cost containment, premises pollution liability, and professional liability. The operative provisions of the Remediation Agreement were triggered on December 20, 2010, on which date Laclede Gas and the other former site owner, as full consideration under the Remediation Agreement, paid a small percentage of the cost of remediation of the site. The amount paid by Laclede Gas, which is its only monetary obligation under the Remediation Agreement, did not materially impact the financial condition, results of operations, or cash flows of the Company.

Laclede Gas has not owned the other site located in the City of St. Louis for many years. In a letter dated June 29, 2011, the Attorney General for the State of Missouri informed Laclede Gas that the Missouri Department of Natural Resources had completed an investigation of the site. The Attorney General requested that Laclede Gas participate in the follow up investigations of the site. In a letter dated January 10, 2012, the Company stated that it would participate in future environmental response activities at the site assuming that other potentially responsible parties are willing to contribute to such efforts in a meaningful and equitable fashion.

To date, amounts required for remediation at these sites have not been material. However, the amount of costs relative to future remedial actions at these and other sites is unknown and may be material. Laclede Gas has notified its insurers that it seeks reimbursement for costs incurred in the past and future potential liabilities associated with the MGP sites. While some of the insurers have denied coverage and reserved their rights, Laclede Gas continues to discuss potential reimbursements with them. In 2005, the Utility’s outside consultant completed an analysis of the MGP sites to determine cost estimates for a one-time contractual transfer of risk from each of the Utility’s insurers of environmental coverage for the MGP sites. That analysis demonstrated a range of possible future expenditures to investigate, monitor, and remediate these MGP sites from $5.8 million to $36.3 million based upon then currently available facts, technology, and laws and regulations. The actual costs that Laclede Gas may incur could be materially higher or lower depending upon several factors, including whether remedial actions will be required, final selection and regulatory approval of any remedial actions, changing technologies and governmental regulations, the ultimate ability of other potentially responsible parties to pay, the successful completion of remediation efforts required by the Remediation Agreement described above, and any insurance recoveries. Costs associated with environmental remediation activities are accrued when such costs are probable and reasonably estimable.

Laclede Gas anticipates that any costs it may incur in the future to remediate these sites, less any amounts received as insurance proceeds or as contributions from other potentially responsible parties, would be deferred and recovered in rates through periodic adjustments approved by the MoPSC. Accordingly, any potential liabilities that may arise with remediating these sites are not expected to have a material impact on the future financial position and results of operations of Laclede Gas or the Company.

On December 28, 2006, the MoPSC Staff proposed a disallowance of $7.2 million related to Laclede Gas’ recovery of its purchased gas costs applicable to fiscal year 2005, which the Staff later reduced to a $1.7 million disallowance pertaining to Laclede Gas’ purchase of gas from a marketing affiliate, LER. The MoPSC Staff has also proposed disallowances of $2.8 million and $1.5 million of gas costs relating to Laclede Gas purchases of gas supply from LER for fiscal years 2006 and 2007, respectively. The MoPSC Staff proposed a number of non-monetary recommendations, based on its review of gas costs for fiscal years 2008 and 2009. Laclede Gas believes that the proposed disallowances lack merit and is vigorously opposing these adjustments in proceedings before the MoPSC. As such, no amount has been recorded in the financial statements for these proposed disallowances.

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In connection with the affiliate transactions mentioned above, on July 7, 2010, the MoPSC Staff filed a complaint against Laclede Gas alleging that, by stating that it was not in possession of proprietary LER documents, Laclede Gas violated the MoPSC Order authorizing the holding company structure (2001 Order). Laclede Gas counterclaimed that the Staff failed to adhere to the pricing provisions of the MoPSC’s affiliate transaction rules and Laclede Gas’ Cost Allocation Manual. By orders dated November 3, 2010 and February 4, 2011, respectively, the MoPSC dismissed Laclede’s counterclaim and granted summary judgment to Staff, finding that Laclede Gas violated the terms of the 2001 Order and authorizing its General Counsel to seek penalties in court against Laclede Gas. On March 30, 2011, Laclede Gas sought review of the February 4 Order with the Missouri Cole County Circuit Court. On May 19, 2011, the Commission’s General Counsel filed a petition with the Cole County Circuit Court seeking penalties in connection with the Commission’s February 4 Order. On July 7, 2011, the Circuit Court Judge signed an agreed Order holding the penalty case in abeyance while the February 4 Order is appealed. On December 21, 2011, the Circuit Court reversed both the MoPSC’s November 3, 2010 Order and its February 4, 2011 Order. The MoPSC appealed and the matter is currently before the Western District Court of Appeals.

Subsequent to the July 7, 2010 complaint, the MoPSC Staff filed a related complaint on October 6, 2010 against Laclede Gas, LER, and Laclede Group, alleging that the Utility has failed to comply with the MoPSC’s affiliate transaction rules. LER and Laclede Group both filed motions to be dismissed from the proceeding, which were granted by the Commission on December 22, 2010. On January 26, 2011, the Commission also dismissed certain counts of the complaint against Laclede Gas. The remaining counts and a counterclaim against the Staff, filed by Laclede Gas, are still pending before the Commission. Laclede Gas believes that the complaint lacks merit and is vigorously opposing it.

On June 29, 2010, the Office of Federal Contract Compliance Programs issued a Notice of Violations to Laclede Gas alleging lapses in certain employment selection procedures during a two-year period ending in February 2006. The Company believes that the allegations lack merit and is vigorously defending its position. Management, after discussion with counsel, believes that the final outcome of these matters will not have a material effect on the consolidated financial position and results of operations of the Company.

As discussed in Note 7, Derivative Instruments and Hedging Activities, Laclede Gas and LER enter into NYMEX and ICE exchange-traded/cleared derivative instruments. Previously, these instruments were held in accounts at MF Global, Inc. On October 31, 2011, affiliated entities of MF Global filed a Chapter 11 petition at the U.S. Bankruptcy Court in the Southern District of New York. Subsequently, the court-appointed bankruptcy trustee transferred all of the open positions and a significant portion of the margin deposits of Laclede Gas and LER to a new brokerage firm. As of April 26, 2012, Laclede Gas and LER had $1.5 million and $0.5 million, respectively, on deposit with MF Global in customer-segregated accounts that remain unavailable pending final resolution by the bankruptcy trustee. While the Company’s total exposure at this time is not considered material, management is unable to predict when, or to what extent, these remaining funds will be returned.

Laclede Group is involved in other litigation, claims, and investigations arising in the normal course of business. Management, after discussion with counsel, believes that the final outcome will not have a material effect on the consolidated financial position, results of operations, or cash flows of the Company.

12. SUBSEQUENT EVENT

On April 27, 2012, Laclede Group announced a new organizational structure that will position the Company to grow through execution of four strategic imperatives: 1) develop and invest in emerging technologies, 2) pursue growth through the acquisition of businesses to which the Company can apply its operating model, 3) invest in infrastructure, and 4) leverage current business unit competencies to enhance growth. The Board of Directors approved the following appointments and promotions effective May 1, 2012:

• Michael R. Spotanski will be appointed to the newly created position of Senior Vice President, Chief Integration and Innovation Officer.  In his new role, Mr. Spotanski will lead the Company’s efforts to integrate regulated natural gas distribution utilities and other businesses that the Company acquires as part of its growth strategy, as well as its efforts to develop and invest in emerging technologies.  Currently, Mr. Spotanski is Senior Vice President Operations and Marketing of Laclede Gas.  Until a new operating officer is appointed for Laclede Gas, Mr. Spotanski will continue to manage operations at Laclede Gas along with Suzanne Sitherwood who will remain President of Laclede Gas.

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• Mark C. Darrell will be appointed to the position of Senior Vice President, General Counsel and Chief Compliance Officer.  In this role, Mr. Darrell will supervise the Company’s corporate legal functions, including mergers and acquisition support, litigation, regulatory affairs, contracts and environmental matters.  He will also be responsible for the Company’s corporate compliance.

• Mary C. Kullman will be promoted to Senior Vice President, Chief Administrative Officer and Corporate Secretary.  In her new role, Ms. Kullman’s responsibilities will include overseeing corporate communications, marketing and branding; the development and implementation of standards for shared services, enterprise risk management and internal audit.  She will retain her current role as corporate secretary and responsibility for corporate governance, securities and ethics.

• Steven P. Rasche will be promoted to Senior Vice President, Finance and Accounting of Laclede Group and appointed Chief Financial Officer of Laclede Gas.  He will also serve as principal accounting officer for the Company and Laclede Gas.  Mr. Rasche’s responsibilities will include accounting, financial reporting and analysis, treasury, tax and investor relations.  Mr. Rasche will report to Mr. Waltermire.

• Richard A. Skau will be appointed to Senior Vice President, Chief Human Resources Officer.  In this role, Mr. Skau will supervise the Company’s efforts to attract, retain, develop and train employees to prepare them to execute on the Company’s strategy.  His responsibilities also include employee relations, payroll, benefits, and diversity and inclusion.

• Mark D. Waltermire will be promoted to Executive Vice President, Chief Financial Officer. In this role, Mr. Waltermire will oversee strategic planning and corporate development, information technology services, finance and accounting, supply chain functions and LER.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This management’s discussion analyzes the financial condition and results of operations of The Laclede Group, Inc. (Laclede Group or the Company) and its subsidiaries. It includes management’s view of factors that affect its business, explanations of past financial results including changes in earnings and costs from the prior year periods, and their effects on overall financial condition and liquidity.

Certain matters discussed in this report, excluding historical information, include forward-looking statements. Certain words, such as “may,” “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “seek,” and similar words and expressions identify forward-looking statements that involve uncertainties and risks. Future developments may not be in accordance with our expectations or beliefs and the effect of future developments may not be those anticipated. Among the factors that may cause results to differ materially from those contemplated in any forward-looking statement are:

• weather conditions and catastrophic events, particularly severe weather in the natural gas producing areas of the country;

• volatility in gas prices, particularly sudden and sustained changes in natural gas prices, including the related impact on margin deposits associated with the use of natural gas derivative instruments;

• the impact of changes and volatility in natural gas prices on our competitive position in relation to suppliers of alternative heating sources, such as electricity;

• changes in gas supply and pipeline availability, including decisions by natural gas producers to reduce production or shut in producing natural gas wells as well as other changes that impact supply for and access to the markets in which our subsidiaries transact business;

• legislative, regulatory and judicial mandates and decisions, some of which may be retroactive, including those affecting

• allowed rates of return

• incentive regulation

• industry structure

• purchased gas adjustment provisions

• rate design structure and implementation

• regulatory assets

• non-regulated and affiliate transactions

• franchise renewals

• environmental or safety matters, including the potential impact of legislative and regulatory actions related to climate change and pipeline safety

• taxes

• pension and other postretirement benefit liabilities and funding obligations

• accounting standards, including the effect of potential changes relative to adoption of or convergence with international accounting standards;

• the results of litigation;

• retention of, ability to attract, ability to collect from, and conservation efforts of, customers;

• capital and energy commodity market conditions, including the ability to obtain funds with reasonable terms for necessary capital expenditures and general operations and the terms and conditions imposed for obtaining sufficient gas supply;

• discovery of material weakness in internal controls; and

• employee workforce issues.

Readers are urged to consider the risks, uncertainties, and other factors that could affect our business as described in this report. All forward-looking statements made in this report rely upon the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. We do not, by including this statement, assume any obligation to review or revise any particular forward-looking statement in light of future events.

The Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company’s Consolidated Financial Statements and the Notes thereto.

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RESULTS OF OPERATIONS

Overview

Laclede Group’s earnings are primarily derived from the regulated activities of its largest subsidiary, Laclede Gas Company (Laclede Gas or the Utility), Missouri’s largest natural gas distribution company. Laclede Gas is regulated by the Missouri Public Service Commission (MoPSC or Commission) and serves the City of St. Louis and parts of ten counties in eastern Missouri. Laclede Gas delivers natural gas to retail customers at rates and in accordance with tariffs authorized by the MoPSC. The Utility’s earnings are primarily generated by the sale of heating energy. The Utility’s weather mitigation rate design lessens the impact of weather volatility on Laclede Gas’ customers during cold winters and stabilizes the Utility’s earnings by recovering fixed costs more evenly during the heating season. Due to the seasonal nature of the business of Laclede Gas, Laclede Group’s earnings are typically concentrated in the November through April period, which generally corresponds with the heating season.

Laclede Energy Resources, Inc. (LER), which includes its wholly owned subsidiary LER Storage Services, Inc. (LSS), is engaged in the marketing of natural gas and related activities on a non-regulated basis. LER markets natural gas to both on-system Utility transportation customers and customers outside of Laclede Gas’ traditional service territory, including large retail and wholesale customers. LER’s operations and customer base are more subject to fluctuations in market conditions than the Utility. LER formed LSS in October 2011 to utilize natural gas storage contracts for providing natural gas sales. Effective January 1, 2012, LSS contracted for 1 Bcf of natural gas storage capacity for a thirteen month period through January 2013, and purchased 1 Bcf of natural gas in place during January 2012 for $3.0 million.  Further, and separately, LSS has entered into a precedent agreement with a natural gas storage facility operator that will provide 1 Bcf of natural gas storage subject to the facility’s successful completion of an expansion program in early to mid-2013.

Other subsidiaries provide less than 10% of consolidated revenues.

On January 26, 2012, the Company’s Board of Directors named Mr. William E. Nasser as Chairman of the Board and appointed Laclede Group’s President, Ms. Suzanne Sitherwood, as Chief Executive Officer (CEO). Ms. Sitherwood was also appointed Laclede Gas Company’s Chairman, President and CEO. These appointments were all effective February 1, 2012, concurrent with Mr. Douglas H. Yaeger’s retirement.

On April 27, 2012, Laclede Group announced a new organizational structure that will position the Company to grow through execution of four strategic imperatives: 1) develop and invest in emerging technologies, 2) pursue growth through the acquisition of businesses to which the Company can apply its operating model, 3) invest in infrastructure, and 4) leverage current business unit competencies to enhance growth. The Board of Directors approved the following appointments and promotions effective May 1, 2012:

• Michael R. Spotanski will be appointed to the newly created position of Senior Vice President, Chief Integration and Innovation Officer.  In his new role, Mr. Spotanski will lead the Company’s efforts to integrate regulated natural gas distribution utilities and other businesses that the Company acquires as part of its growth strategy, as well as its efforts to develop and invest in emerging technologies.  Currently, Mr. Spotanski is Senior Vice President Operations and Marketing of Laclede Gas.  Until a new operating officer is appointed for Laclede Gas, Mr. Spotanski will continue to manage operations at Laclede Gas along with Suzanne Sitherwood who will remain President of Laclede Gas.

• Mark C. Darrell will be appointed to the position of Senior Vice President, General Counsel and Chief Compliance Officer.  In this role, Mr. Darrell will supervise the Company’s corporate legal functions, including mergers and acquisition support, litigation, regulatory affairs, contracts and environmental matters.  He will also be responsible for the Company’s corporate compliance.

• Mary C. Kullman will be promoted to Senior Vice President, Chief Administrative Officer and Corporate Secretary.  In her new role, Ms. Kullman’s responsibilities will include overseeing corporate communications, marketing and branding; the development and implementation of standards for shared services, enterprise risk management and internal audit.  She will retain her current role as corporate secretary and responsibility for corporate governance, securities and ethics.

30

• Steven P. Rasche will be promoted to Senior Vice President, Finance and Accounting of Laclede Group and appointed Chief Financial Officer of Laclede Gas.  He will also serve as principal accounting officer for the Company and Laclede Gas.  Mr. Rasche’s responsibilities will include accounting, financial reporting and analysis, treasury, tax and investor relations.  Mr. Rasche will report to Mr. Waltermire.

• Richard A. Skau will be appointed to Senior Vice President, Chief Human Resources Officer.  In this role, Mr. Skau will supervise the Company’s efforts to attract, retain, develop and train employees to prepare them to execute on the Company’s strategy.  His responsibilities also include employee relations, payroll, benefits, and diversity and inclusion.

• Mark D. Waltermire will be promoted to Executive Vice President, Chief Financial Officer. In this role, Mr. Waltermire will oversee strategic planning and corporate development, information technology services, finance and accounting, supply chain functions and LER.

Based on the nature of the business of the Company and its subsidiaries, as well as current economic conditions, management focuses on the following key variables in evaluating the financial condition and results of operations and managing the business:

Regulated Gas Distribution Segment:

• the Utility’s ability to recover the costs of purchasing and distributing natural gas from its customers;

• the impact of weather and other factors, such as customer conservation, on revenues and expenses;

• changes in the regulatory environment at the federal, state, and local levels, as well as decisions by regulators, that impact the Utility’s ability to earn its authorized rate of return;

• the Utility’s ability to access credit markets and maintain working capital sufficient to meet operating requirements; and,

• the effect of natural gas price volatility on the business.

Non-Regulated Gas Marketing Segment:

• the risks of competition;

• fluctuations in natural gas prices;

• new national pipeline infrastructure projects;

• the ability to procure firm transportation and storage services at reasonable rates;

• credit and/or capital market access;

• counterparty risks;

• the effect of natural gas price volatility on the business; and,

• pursuing additional growth.

Further information regarding how management seeks to manage these key variables is discussed below.

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Laclede Gas continues to provide reliable natural gas service at a reasonable cost, while maintaining and building a secure and dependable infrastructure. The Utility’s strategy focuses on improving performance and mitigating the impact of weather fluctuations on Laclede Gas’ customers while improving the ability to recover its authorized distribution costs and return. The Utility’s distribution costs are the essential, primarily fixed, expenditures it must incur to operate and maintain more than 16,000 miles of mains and services comprising its natural gas distribution system and related storage facilities. The Utility’s distribution costs include wages and employee benefit costs, depreciation and maintenance expenses, and other regulated utility operating expenses, excluding natural and propane gas expense. Distribution costs are considered in the ratemaking process, and recovery of these types of costs is included in revenues generated through the Utility’s tariff rates, as approved by the MoPSC. The settlement of the Utility’s rate case in 2010 retained the Utility’s weather mitigation rate design that better ensures the recovery of its fixed costs and margins despite variations in sales volumes due to the impacts of weather and other factors that affect customer usage.

The Utility’s income from off-system sales and capacity release remains subject to fluctuations in market conditions. The Utility is allowed to retain 15% to 25% of the first $6 million in annual income earned (depending on the level of income earned) and 30% of income exceeding $6 million annually. Some of the factors impacting the level of off-system sales include the availability and cost of the Utility’s natural gas supply, the weather in its service area, and the weather in other markets. When Laclede Gas’ service area experiences warmer-than-normal weather while other markets experience colder weather or supply constraints, some of the Utility’s natural gas supply is available for off-system sales and there may be a demand for such supply in other markets. See the Regulatory and Other Matters section on page 38 of this report for additional information on regulatory issues relative to the Utility.

Laclede Gas works actively to reduce the impact of wholesale natural gas price volatility on its costs by strategically structuring its natural gas supply portfolio to increase its gas supply availability and pricing alternatives and through the use of derivative instruments to protect its customers from significant changes in the commodity price of natural gas. Nevertheless, the overall cost of purchased gas remains subject to fluctuations in market conditions. The Utility’s Purchased Gas Adjustment (PGA) Clause allows Laclede Gas to flow through to customers, subject to prudence review by the MoPSC, the cost of purchased gas supplies, including costs, cost reductions, and related carrying costs associated with the use of derivative instruments to hedge the purchase price of natural gas, as well as gas inventory carrying costs. The Utility believes it will continue to be able to obtain sufficient gas supply. The price of natural gas supplies and other economic conditions may affect sales volumes, due to the conservation efforts of customers, and cash flows associated with the timing of collection of gas costs and related accounts receivable from customers.

The Utility relies on both short-term credit and long-term capital markets, as well as cash flows from operations, to satisfy its seasonal cash requirements and fund its cost of capital expenditures. Laclede Gas’ ability to issue commercial paper supported by lines of credit, to issue long-term bonds, or to obtain new lines of credit is dependent on current conditions in the credit and capital markets. Management focuses on maintaining a strong balance sheet and believes it currently has adequate access to credit and capital markets and will have sufficient capital resources to meet its foreseeable obligations. See the Liquidity and Capital Resources section on page 40 for additional information.

LER provides both on-system Utility transportation customers and customers outside of Laclede Gas’ traditional service area with another choice in non-regulated natural gas suppliers. LER utilizes its natural gas supply agreements, transportation agreements, storage agreements, and other executory contracts to support a variety of services to its customers at competitive prices. It closely monitors and manages the natural gas commodity price risk associated with providing such services to its customers through the use of exchange-traded/cleared derivative instruments and other contractual arrangements. LER is committed to managing commodity price risk, while it seeks to expand the services that it now provides. Nevertheless, income from LER’s operations is more subject to fluctuations in market conditions than the Utility’s operations. LER’s business is directly impacted by the effects of competition in the marketplace, the impact of new pipeline infrastructure, and surplus natural gas supplies on natural gas commodity prices.

In addition to its operating cash flows, LER relies on Laclede Group’s parental guarantees to secure its purchase and sales obligations of natural gas. LER also has access to Laclede Group’s liquidity resources. A large portion of LER’s receivables are from customers in the energy industry. LER also enters into netting arrangements with many of its energy counterparties to reduce overall credit and collateral exposure. Although LER’s uncollectible amounts are closely monitored and have not been significant, increases in uncollectible amounts from customers are possible and could adversely affect LER’s liquidity and results.

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LER carefully monitors the creditworthiness of counterparties to its transactions. LER performs in-house credit reviews of potential customers and may require credit assurances such as prepayments, letters of credit, or parental guarantees when appropriate. Credit limits for customers are established and monitored.

In response to new pipeline infrastructure, changes in availability of regional natural gas supplies, and other changes in marketplace dynamics, there is a reduced probability of physical settlement of some of LER’s wholesale purchase and sale transactions. As such, certain transactions entered into on or after January 1, 2012 are designated as trading activities for financial reporting purposes, due to their settlement characteristics, rather than elected for normal purchases or normal sales designations under generally accepted accounting principles (GAAP). Results of operations from trading activities are reported on a net basis (instead of a gross basis) in Non-Regulated Gas Marketing Operating Revenues, which may cause reductions in and/or volatility in the Company’s operating revenues, but has no effect on operating income or net income.

In the course of its business, LER enters into commitments associated with the purchase or sale of natural gas. In accordance with GAAP, some of LER’s purchase and sale transactions are not recognized in earnings until the natural gas is physically delivered, while other energy-related transactions, including those designated as trading activities, are required to be accounted for as derivatives, with the changes in their fair value (representing unrealized gains or losses) recorded in earnings in periods prior to settlement. Because related transactions of a purchase and sale strategy may be accounted for differently, there may be timing differences in the recognition of earnings under GAAP and economic earnings realized upon settlement. The Company reports both GAAP and net economic earnings, as discussed below.

EARNINGS

The Laclede Group reports net income and earnings per share determined in accordance with GAAP. Management also uses the non-GAAP measures of net economic earnings and net economic earnings per share when internally evaluating results of operations. These non-GAAP measures exclude from net income the after-tax impacts of fair value accounting and timing adjustments associated with energy-related transactions. These adjustments include timing differences where the accounting treatment differs from the economic substance of the underlying transaction, including the following:

•	Net unrealized gains and losses on energy-related derivatives that are required by GAAP fair value accounting associated with current changes in the fair value of financial and physical transactions prior to their completion and settlement. These unrealized gains and losses result primarily from two sources:
	1)	changes in the fair values of physical and/or financial derivatives prior to the period of settlement; and,
	2)	ineffective portions of accounting hedges, required to be recorded in earnings prior to settlement, due to differences in commodity price changes between the locations of the forecasted physical purchase or sale transactions and the locations of the underlying hedge instruments;
•	Lower of cost or market adjustments to the carrying value of commodity inventories resulting when the market price of the commodity falls below its original cost, to the extent that those commodities are economically hedged; and,
•	Realized gains and losses resulting from the settlement of economic hedges prior to the sale of the physical commodity.

These adjustments eliminate the impact of timing differences and the impact of current changes in the fair value of financial and physical transactions prior to their completion and settlement. Unrealized gains or losses are recorded in each period until being replaced with the actual gains or losses realized when the associated physical transaction(s) occur. While management uses these non-GAAP measures to evaluate both Laclede Gas and LER, the net effect of adjustments on the Utility’s earnings is minimal because gains or losses on its natural gas derivative instruments are deferred pursuant to its PGA Clause, as authorized by the MoPSC.

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Management believes that excluding the earnings volatility caused by recognizing changes in fair value prior to settlement and other timing differences associated with related purchase and sale transactions provides a useful representation of the economic effects of only the actual settled transactions and their effects on results of operations. In addition, management will exclude the effect of costs related to unique acquisition, divestiture, and restructuring activities, if any, when evaluating on-going performance, and therefore will exclude these costs from net economic earnings. These internal non-GAAP operating metrics should not be considered as an alternative to, or more meaningful than, GAAP measures such as net income. Reconciliations of net economic earnings and net economic earnings per share to the Company’s most directly comparable GAAP measures are provided below.

Quarter Ended March 31, 2012

(Millions, except per share amounts)			Regulated Gas Distribution			Non-Regulated Gas Marketing				Other			Total				Per Share Amounts**
Quarter Ended March 31, 2012
	Net Economic Earnings (Non-GAAP)			$	25.8		$	2.5			$	0.1		$	28.4			$	1.27
	Add:  Unrealized gain (loss) on energy-related      derivatives*				—			2.0				—			2.0				0.09
	Add:  Lower of cost or market inventory adjustments*				—			(0.6	)			—			(0.6	)			(0.03	)
	Add:  Realized gain (loss) on economic hedges prior      to the sale of the physical commodity*				—			(0.1	)			—			(0.1	)			(0.01	)
	Net Income (GAAP)			$	25.8		$	3.8			$	0.1		$	29.7			$	1.32
Quarter Ended March 31, 2011
	Net Economic Earnings (Non-GAAP)			$	26.2		$	1.3			$	—		$	27.5			$	1.23
	Add:  Unrealized gain (loss) on energy-related      derivatives*				—			0.4				—			0.4				0.02
	Add:  Lower of cost or market inventory adjustments*				—			—				—			—				—
	Add:  Realized gain (loss) on economic hedges prior      to the sale of the physical commodity*				—			—				—			—				—
	Net Income (GAAP)			$	26.2		$	1.7			$	—		$	27.9			$	1.25
*		Amounts presented net of income taxes. Income taxes are calculated by applying federal, state, and local income tax rates applicable to ordinary income to the amounts of the pre-tax reconciling items. For the quarters ended March 31, 2012 and 2011, the total net amount of income tax expense included in the reconciling items above is $0.8 million and $0.3 million, respectively.
**		Net economic earnings per share is calculated by replacing consolidated net income with consolidated net economic earnings in the GAAP diluted earnings per share calculation.

Laclede Group’s net income was $29.7 million for the quarter ended March 31, 2012, compared with $27.9 million for the quarter ended March 31, 2011. Basic and diluted earnings per share for the quarter ended March 31, 2012 were $1.33 and $1.32, respectively, compared with basic and diluted earnings per share of $1.25 for the quarter ended March 31, 2011. Earnings increased compared to last year primarily due to higher income reported by Laclede Group’s Non-Regulated Gas Marketing segment, partially offset by slightly lower income reported by Laclede Group’s Regulated Gas Distribution segment. Net economic earnings were $28.4 million for the quarter ended March 31, 2012, compared with $27.5 million for the same quarter last year. Net economic earnings per share were $1.27 for the quarter ended March 31, 2012, compared with $1.23 for the quarter ended March 31, 2011.

Both Regulated Gas Distribution net income and Regulated Gas Distribution net economic earnings decreased by $0.4 million for the quarter ended March 31, 2012, compared with the quarter ended March 31, 2011. The decrease was primarily due to the following factors, quantified on a pre-tax basis:

• lower system gas sales margins and other variations, totaling $4.4 million, primarily due to the effect of  weather in the Utility’s service area during the three months ended March 31, 2012, which was the warmest such quarter on record; and

• increases in pension and group insurance expenses totaling $3.3 million.

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These factors were partially offset by:

• decreases in operation and maintenance expenses, excluding pension and group insurance expenses, totaling $5.4 million; and

• higher Infrastructure System Replacement Surcharge (ISRS) revenues totaling $1.1 million.

The Non-Regulated Gas Marketing segment reported GAAP earnings totaling $3.8 million, an increase of $2.1 million compared with the same quarter last year. Net economic earnings for the quarter ended March 31, 2012 increased $1.2 million from the quarter ended March 31, 2011. These increases were primarily due to higher margins, mainly due to the effect of reduced transportation costs resulting from the renegotiation of contracts that were renewed during the latter half of fiscal year 2011. On a GAAP basis, the increased sales margins also included the net effect of higher unrealized gains from certain of LER’s energy-related derivative contracts, compared with the same period last year, and a lower of cost or market inventory adjustment recorded during the quarter ended March 31, 2012.

Regulated Gas Distribution Operating Revenues

Laclede Gas passes on to Utility customers (subject to prudence review by the MoPSC) increases and decreases in the wholesale cost of natural gas in accordance with its PGA Clause. The volatility of the wholesale natural gas market results in fluctuations from period to period in the recorded levels of, among other items, revenues and natural gas cost expense. Nevertheless, increases and decreases in the cost of gas associated with system gas sales volumes have no direct effect on net revenues and net income.

Regulated Gas Distribution Operating Revenues for the quarter ended March 31, 2012 were $298.6 million, or $89.8 million less than the same period last year. Temperatures experienced in the Utility’s service area during the quarter ended March 31, 2012, which were the warmest on record, were 32.0% warmer than the same quarter last year and 30.1% warmer than normal. Total system therms sold and transported were 305.2 million for the quarter ended March 31, 2012, compared with 411.1 million for the same period last year. Total off-system therms sold and transported were 130.0 million for the quarter ended March 31, 2012, compared with 84.4 million for the same period last year. The decrease in Regulated Gas Distribution Operating Revenues was primarily attributable to the following factors:

(Millions)
Lower system sales volumes and other variations	$	(72.4	)
Lower prices charged for off-system sales		(20.5	)
Higher off-system sales volumes (reflecting more favorable market conditions as described in greater      detail in the Results of Operations - Overview)		19.1
Lower wholesale gas costs passed on to Utility customers (subject to prudence review by the MoPSC)		(17.1	)
Higher ISRS revenues		1.1
Total Variation	$	(89.8	)

Regulated Gas Distribution Operating Expenses

Regulated Gas Distribution Operating Expenses for the quarter ended March 31, 2012 decreased $95.8 million from the same quarter last year. Natural and propane gas expense decreased $89.5 million, or 34.3%, from last year’s level, primarily attributable to decreased system volumes purchased for sendout and lower rates charged by our suppliers. Other operation and maintenance expenses decreased $2.1 million, or 4.7%, primarily due to a higher rate of overheads capitalized, a lower provision for uncollectible accounts, and decreased maintenance charges, partially offset by higher pension and group insurance expenses. Taxes, other than income taxes, decreased $4.6 million, or 18.6%, primarily due to decreased gross receipts taxes (attributable to decreased system sales revenues).

Non-Regulated Gas Marketing Operating Revenues and Operating Expenses

Non-Regulated Gas Marketing Operating Revenues and Operating Expenses decreased $95.7 million and $90.5 million, respectively, primarily due to the effect of lower per unit gas prices charged by LER. These decreases also include the effect of recording certain transactions on a net basis (instead of a gross basis), as described in greater detail in Results of Operations – Overview. LER’s sales volumes during the quarter ended March 31, 2012 were essentially unchanged from the same period last year.

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Other Income and (Income Deductions) - Net

Other Income and (Income Deductions) – Net increased $0.9 million primarily due to higher net investment gains.

Interest Charges

Interest charges during the quarter ended March 31, 2012 were essentially unchanged from the same period last year. Average short-term interest rates were 0.3% for both the quarters ended March 31, 2012 and 2011. Average short-term borrowings were $68.7 million for the quarter ended March 31, 2012, compared with $54.3 million for the quarter ended March 31, 2011.

Six Months Ended March 31, 2012

(Millions, except per share amounts)			Regulated Gas Distribution			Non-Regulated Gas Marketing				Other			Total				Per Share Amounts**
Six Months Ended March 31, 2012
	Net Economic Earnings (Non-GAAP)			$	46.8		$	6.0			$	0.5		$	53.3			$	2.38
	Add:  Unrealized gain (loss) on energy-related      derivatives*				0.1			2.2				—			2.3				0.11
	Add:  Lower of cost or market inventory adjustments*				—			(0.6	)			—			(0.6	)			(0.03	)
	Add:  Realized gain (loss) on economic hedges prior      to the sale of the physical commodity*				—			(0.1	)			—			(0.1	)			(0.01	)
	Net Income (GAAP)			$	46.9		$	7.5			$	0.5		$	54.9			$	2.45
Six Months Ended March 31, 2011
	Net Economic Earnings (Non-GAAP)			$	47.6		$	3.3			$	—		$	50.9			$	2.28
	Add:  Unrealized gain (loss) on energy-related      derivatives*				0.1			0.3				—			0.4				0.02
	Add:  Lower of cost or market inventory adjustments*				—			—				—			—				—
	Add:  Realized gain (loss) on economic hedges prior      to the sale of the physical commodity*				—			—				—			—				—
	Net Income (GAAP)			$	47.7		$	3.6			$	—		$	51.3			$	2.30
*		Amounts presented net of income taxes. Income taxes are calculated by applying federal, state, and local income tax rates applicable to ordinary income to the amounts of the pre-tax reconciling items. For the six months ended March 31, 2012 and 2011, the total net amount of income tax expense included in the reconciling items above is $1.0 million and $0.3 million, respectively.
**		Net economic earnings per share is calculated by replacing consolidated net income with consolidated net economic earnings in the GAAP diluted earnings per share calculation.

Laclede Group’s net income was $54.9 million for the six months ended March 31, 2012, compared with $51.3 million for the six months ended March 31, 2011. Basic and diluted earnings per share for the six months ended March 31, 2012 were $2.45, compared with basic and diluted earnings per share of $2.30 for the six months ended March 31, 2011. Earnings increased compared to last year primarily due to improved results reported by Laclede Group’s Non-Regulated Gas Marketing segment, partially offset by slightly lower income reported by Laclede Group’s Regulated Gas Distribution segment. Net economic earnings were $53.3 million for the six months ended March 31, 2012, compared with $50.9 million for the same period last year. Net economic earnings per share were $2.38 for the six months ended March 31, 2012, compared with $2.28 for the six months ended March 31, 2011.

Regulated Gas Distribution net income and Regulated Gas Distribution net economic earnings decreased by $0.8 million for the six months ended March 31, 2012, compared with the six months ended March 31, 2011. These decreases were primarily attributable to the following factors, quantified on a pre-tax basis:

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• lower system gas sales margins and other variations, totaling $3.7 million, primarily due to the effect of weather in the Utility’s service area during the six months ended March 31, 2012, which was the warmest such period on record; and

• increases in pension and group insurance expenses totaling $4.9 million.

These factors were partially offset by:

• decreases in operating and maintenance expenses, excluding pension and group insurance expenses, totaling $5.2 million; and

• higher ISRS revenues totaling $2.2 million.

The Non-Regulated Gas Marketing segment reported an increase in GAAP earnings of $3.9 million compared with the same period last year. Net economic earnings for the six months ended March 31, 2012 increased $2.7 million from the six months ended March 31, 2011. The increased net economic earnings were primarily due to LER’s increased margins, mainly due to the effect of reduced transportation costs resulting from the renegotiation of contracts that were renewed during the latter half of fiscal year 2011. On a GAAP basis, the increased sales margins also included the net effect of higher unrealized gains from certain of LER’s energy-related derivative contracts, compared with the same period last year, and a lower of cost or market inventory adjustment recorded during the six months ended March 31, 2012.

Regulated Gas Distribution Operating Revenues

Laclede Gas passes on to Utility customers (subject to prudence review by the MoPSC) increases and decreases in the wholesale cost of natural gas in accordance with its PGA Clause. The volatility of the wholesale natural gas market results in fluctuations from period to period in the recorded levels of, among other items, revenues and natural gas cost expense. Nevertheless, increases and decreases in the cost of gas associated with system gas sales volumes have no direct effect on net revenues and net income.

Regulated Gas Distribution Operating Revenues for the six months ended March 31, 2012 were $549.5 million, or $116.3 million less than the same period last year. Temperatures experienced in the Utility’s service area during the six months ended March 31, 2012, which were the warmest on record, were 27.5% warmer than the same period last year and 26.8% warmer than normal. Total system therms sold and transported were 543.7 million for the six months ended March 31, 2012, compared with 697.0 million for the same period last year. Total off-system therms sold and transported were 228.2 million for the six months ended March 31, 2012, compared with 138.1 million for the same period last year. The decrease in Regulated Gas Distribution Operating Revenues was primarily attributable to the following factors:

(Millions)
Lower system sales volumes and other variations	$	(101.9	)
Higher off-system sales volumes (reflecting more favorable market conditions as described in greater      detail in the Results of Operations - Overview)		36.9
Lower wholesale gas costs passed on to Utility customers (subject to prudence review by the MoPSC)		(27.1	)
Lower prices charged for off-system sales		(26.4	)
Higher ISRS revenues		2.2
Total Variation	$	(116.3	)

Regulated Gas Distribution Operating Expenses

Regulated Gas Distribution Operating Expenses for the six months ended March 31, 2012 decreased $121.2 million from the same period last year. Natural and propane gas expense decreased $116.2 million, or 26.8%, from last year’s level, primarily attributable to decreased system volumes purchased for sendout and lower rates charged by our suppliers. Other operation and maintenance expenses decreased $0.3 million, or 0.3%, primarily due to a higher rate of overheads capitalized, decreased maintenance charges, and a lower provision for uncollectible accounts, partially offset by higher pension and group insurance expenses. Depreciation and amortization expense increased $0.9 million, or 4.6%, primarily due to additional depreciable property. Taxes, other than income taxes, decreased $5.7 million, or 14.0%, primarily due to decreased gross receipts taxes (attributable to decreased system sales revenues).

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Non-Regulated Gas Marketing Operating Revenues and Operating Expenses

Non-Regulated Gas Marketing Operating Revenues and Operating Expenses decreased $103.5 million and $101.3 million, respectively, primarily due to the effect of lower per unit gas prices charged by LER. These decreases also include the effect of recording certain transactions on a net basis (instead of a gross basis), as described in greater detail in Results of Operations - Overview. LER’s sales volumes during the six months ended March 31, 2012 were essentially unchanged from the same period last year.

Other Income and (Income Deductions) - Net

Other Income and (Income Deductions) – Net increased $1.0 million primarily due to higher net investment gains.

Interest Charges

The $0.4 million decrease in interest charges was primarily due to lower interest on long-term debt, attributable to the November 2010 maturity of $25 million principal amount of 6 1/2 % first mortgage bonds. Average short-term interest rates were 0.3% for both the six months ended March 31, 2012 and 2011. Average short-term borrowings were $75.0 million for the six months ended March 31, 2012, compared with $91.5 million for the six months ended March 31, 2011.

Income Taxes

The $0.8 million increase in income taxes was primarily due to higher pre-tax income, partially offset by the effects of various property-related deductions.

REGULATORY AND OTHER MATTERS

On December 28, 2006, the MoPSC Staff proposed a disallowance of $7.2 million related to Laclede Gas’ recovery of its purchased gas costs applicable to fiscal year 2005, which the Staff later reduced to a $1.7 million disallowance pertaining to Laclede Gas’ purchase of gas from a marketing affiliate, LER. The MoPSC Staff has also proposed disallowances of $2.8 million and $1.5 million of gas costs relating to Laclede Gas purchases of gas supply from LER for fiscal years 2006 and 2007, respectively. The MoPSC Staff proposed a number of non-monetary recommendations, based on its review of gas costs for fiscal years 2008 and 2009. Laclede Gas believes that the proposed disallowances lack merit and is vigorously opposing these adjustments in proceedings before the MoPSC. As such, no amount has been recorded in the financial statements for these proposed disallowances.

In connection with the affiliate transactions mentioned above, on July 7, 2010, the MoPSC Staff filed a complaint against Laclede Gas alleging that, by stating that it was not in possession of proprietary LER documents, Laclede Gas violated the MoPSC Order authorizing the holding company structure (2001 Order). Laclede Gas counterclaimed that the Staff failed to adhere to the pricing provisions of the MoPSC’s affiliate transaction rules and Laclede Gas’ Cost Allocation Manual. By orders dated November 3, 2010 and February 4, 2011, respectively, the MoPSC dismissed Laclede’s counterclaim and granted summary judgment to Staff, finding that Laclede Gas violated the terms of the 2001 Order and authorizing its General Counsel to seek penalties in court against Laclede Gas. On March 30, 2011, Laclede Gas sought review of the February 4 Order with the Missouri Cole County Circuit Court. On May 19, 2011, the Commission’s General Counsel filed a petition with the Cole County Circuit Court seeking penalties in connection with the Commission’s February 4 Order. On July 7, 2011, the Circuit Court Judge signed an agreed Order holding the penalty case in abeyance while the February 4 Order is appealed. On December 21, 2011, the Circuit Court reversed both the MoPSC’s November 3, 2010 Order and its February 4, 2011 Order. The MoPSC appealed and the matter is currently before the Western District Court of Appeals.

Subsequent to the July 7, 2010 complaint, the MoPSC Staff filed a related complaint on October 6, 2010 against Laclede Gas, LER, and Laclede Group, alleging that the Utility has failed to comply with the MoPSC’s affiliate transaction rules. LER and Laclede Group both filed motions to be dismissed from the proceeding, which were granted by the Commission on December 22, 2010. On January 26, 2011, the Commission also dismissed certain counts of the complaint against Laclede Gas. The remaining counts and a counterclaim against the Staff, filed by Laclede Gas, are still pending before the Commission. Laclede Gas believes that the complaint lacks merit and is vigorously opposing it.

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On November 9, 2011, the Utility made an ISRS filing with the Commission designed to increase revenues by $2.0 million annually, essentially all of which was approved by the MoPSC effective January 13, 2012. On April 27, 2012, the Utility made another ISRS filing with the Commission designed to increase revenues by $3.1 million annually, pending approval by the Commission.

On June 29, 2010, the Office of Federal Contract Compliance Programs issued a Notice of Violations to Laclede Gas alleging lapses in certain employment selection procedures during a two-year period ending in February 2006. The Company believes that the allegations lack merit and is vigorously defending its position. Management, after discussion with counsel, believes that the final outcome of these matters will not have a material effect on the consolidated financial position and results of operations of the Company.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition, results of operations, liquidity, and capital resources is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. GAAP requires that we make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. Our critical accounting policies used in the preparation of our Consolidated Financial Statements are described in Item 7 of our Annual Report on Form 10-K for the fiscal year ended September 30, 2011 and include the following:

• Accounts receivable and allowance for doubtful accounts

• Employee benefits and postretirement obligations

• Regulated operations

There were no significant changes to these critical accounting policies during the six months ended March 31, 2012. The Company’s policy on certain energy contracts is presented below:

Non-Regulated Gas Marketing Energy Contracts – LER routinely enters into contracts associated with the physical purchase or sale of natural gas in a future period. In determining the appropriate accounting treatment for these contracts, management is required to assess the contract terms and various other factors to determine if the contracts are subject to the derivative accounting guidance in ASC Topic 815, “Derivatives and Hedging.” If a contract is deemed to meet the definition of derivative, management’s judgment may be further required in determining if the contract is eligible for the normal purchases or normal sales election, which, if elected, permits the Company to account for the contract in the period the natural gas is delivered. Pursuant to GAAP, contracts not designated as normal purchases or normal sales are required to be accounted for as derivatives with changes in fair value (representing unrealized gains or losses) recognized in earnings in the periods prior to physical delivery. Furthermore, management is required to determine whether revenues and expenses, including realized and unrealized gains and losses, on energy contracts should be reported on a gross or net basis in the Statements of Consolidated Income. In the absence of quoted prices in active markets for identical assets or liabilities, determining the fair value of a derivative contract requires judgment as to the appropriateness of various market inputs and involves making assumptions regarding how market participants would price the asset or liability. In addition to these physical contracts, LER also utilizes natural gas futures, swap, and option contracts traded on or cleared through the New York Mercantile Exchange (NYMEX) and Ice Clear Europe (ICE) to manage the price risk associated with certain of its fixed-price commitments. These contracts may be designated for hedge accounting treatment, as discussed in Note 7 of the Notes to Consolidated Financial Statements.

For discussion of other significant accounting policies, see Note 1 of the Notes to Consolidated Financial Statements included in the Company’s Form 10-K for the fiscal year ended September 30, 2011.

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ACCOUNTING PRONOUNCEMENTS

The Company has evaluated or is in the process of evaluating the impact that recently issued accounting standards will have on the Company’s financial position or results of operations upon adoption. For disclosures related to the adoption of new accounting standards, see the New Accounting Standards section of Note 1 of the Notes to Consolidated Financial Statements.

The Company continues to monitor the developments of the Financial Accounting Standards Board (FASB) relative to possible changes in accounting standards. Currently, the FASB is considering various changes to U. S. GAAP, some of which may be significant, as part of a joint effort with the International Accounting Standards Board to converge accounting standards. Future developments, depending on the outcome, have the potential to impact the Company’s financial condition and results of operations.

FINANCIAL CONDITION

CASH FLOWS

The Company’s short-term borrowing requirements typically peak during colder months when Laclede Gas borrows money to cover the lag between when it purchases its natural gas and when its customers pay for that gas. Changes in the wholesale cost of natural gas (including cash payments for margin deposits associated with the Utility’s use of natural gas derivative instruments), variations in the timing of collections of gas cost under the Utility’s PGA Clause, and the utilization of storage gas inventories cause short-term cash requirements to vary during the year and from year to year, and can cause significant variations in the Utility’s cash provided by or used in operating activities.

Net cash provided by operating activities was $71.5 million for the six months ended March 31, 2012, compared with $140.0 million for the same period last year. The variation is primarily attributable to increased cash payments for margin deposits associated with the Utility’s use of natural gas derivative instruments and other variations associated with the timing of collections of gas cost under the Utility’s PGA Clause, as well as increased cash payments for the funding of pension plans. These factors were partially offset by improved cash flows at LER.

Net cash used in investing activities for the six months ended March 31, 2012 was $42.1 million compared with $31.3 million for the six months ended March 31, 2011. The variation primarily reflects increased capital expenditures this year.

Net cash used in financing activities was $63.3 million for the six months ended March 31, 2012 compared with $172.7 million for the six months ended March 31, 2011. The variation primarily reflects decreased repayments of short-term debt this year and the effect of the maturity of long-term debt last year.

LIQUIDITY AND CAPITAL RESOURCES

Cash and Cash Equivalents

Laclede Group had temporary cash investments totaling $5.3 million at March 31, 2012, earning an average interest rate of 0.2%. These investments, which are presented in the Cash and cash equivalents line of the Consolidated Balance Sheets, were diversified among money market funds and interest-bearing deposits at highly-rated commercial banks. The money market funds are accessible by the Company on demand. The bank deposits are also generally available on demand, though the banks reserve the right to require seven days’ notice for a withdrawal. These funds are used to support the working capital needs of the Company’s subsidiaries. The balance of short-term investments ranged between $5.3 million and $19.8 million during the six months ended March 31, 2012. Due to lower yields available to Laclede Group on its short-term investments, Laclede Group elected to provide a) a portion of Laclede Gas’ short-term funding through intercompany lending during the six months ended March 31, 2012 and b) all of its short-term funding on March 31, 2012.

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Short-term Debt

As indicated in the discussion of cash flows above, the Company’s short-term borrowing requirements typically peak during the colder months. These short-term cash requirements can be met through the sale of commercial paper supported by lines of credit with banks or through direct use of the lines of credit. At March 31, 2012, Laclede Gas had a syndicated line of credit in place of $300 million from seven banks, with the largest portion provided by a single bank being 17.9%. This line is scheduled to expire in July 2016. Laclede Gas’ line of credit includes a covenant limiting total debt, including short-term debt, to no more than 70% of total capitalization. As defined in the line of credit, total debt was 50% of total capitalization on March 31, 2012.

Short-term cash requirements outside of Laclede Gas have generally been met with internally-generated funds. However, Laclede Group has $50 million in a syndicated line of credit, scheduled to expire in July 2016, to meet short-term liquidity needs of its subsidiaries. The line of credit has a covenant limiting the total debt of the consolidated Laclede Group to no more than 70% of the Company’s total capitalization. As defined in the line of credit, this ratio stood at 37% on March 31, 2012. Laclede Group’s lines have been used to provide for seasonal funding needs. There were no borrowings under Laclede Group’s line during the six months ended March 31, 2012.

Information about Laclede Group’s consolidated short-term borrowings (excluding intercompany borrowings) during the six months ended March 31, 2012 and as of March 31, 2012, is presented below:

	Laclede Gas Commercial Paper Borrowings
Six Months Ended March 31, 2012
Weighted average borrowings outstanding	$75.0 million
Weighted average interest rate	0.3%
Range of borrowings outstanding	$0 – $133.5 million
As of March 31, 2012
Borrowings outstanding at end of period	None
Weighted average interest rate	N/A

Based on average short-term borrowings for the six months ended March 31, 2012, an increase in the average interest rate of 100 basis points would decrease Laclede Group’s pre-tax earnings and cash flows by approximately $0.8 million on an annual basis, portions of which may be offset through the application of PGA carrying costs.

Long-term Debt, Equity, and Shelf Registrations

The Utility has MoPSC authority to issue debt securities and preferred stock, including on a private placement basis, as well as to issue common stock, receive paid-in capital, and enter into capital lease agreements, all for a total of up to $518 million, effective through June 30, 2013. During the six months ended March 31, 2012, pursuant to this authority, the Utility sold 29 shares of its common stock to Laclede Group for $1.1 million. As of April 27, 2012, $514.7 million remains available under this authorization. The amount, timing, and type of additional financing to be issued will depend on cash requirements and market conditions, as well as future MoPSC authorizations.

At March 31, 2012, Laclede Gas had fixed-rate long-term debt totaling $365 million (including current maturities). While these long-term debt issues are fixed-rate, they are subject to changes in their fair value as market interest rates change. However, increases or decreases in fair value would impact earnings and cash flows only if Laclede Gas were to reacquire any of these issues in the open market prior to maturity. Under GAAP applicable to Laclede Gas’ regulated operations, losses or gains on early redemptions of long-term debt would typically be deferred as regulatory assets or regulatory liabilities and amortized over a future period. Of the Utility’s $365 million in long-term debt, $50 million have no call option, $235 million have make-whole call options, and $80 million are callable at par in 2013. None of the debt has any put options.

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Laclede Group has a registration statement on file on Form S-3 for the issuance and sale of up to 285,222 shares of its common stock under its Dividend Reinvestment and Stock Purchase Program. There were 262,856 and 254,164 shares at March 31, 2012 and April 27, 2012, respectively, remaining available for issuance under its Form S-3. Laclede Group also has an automatic shelf registration statement on Form S-3 for the issuance of equity and debt securities. No securities have been issued under that S-3. The amount, timing, and type of financing to be issued under this shelf registration will depend on cash requirements and market conditions.

Guarantees

Laclede Group had guarantees totaling $86.3 million for performance and payment of certain wholesale gas supply purchases by LER, as of March 31, 2012. Since that date, total guarantees issued by Laclede Group on behalf of LER decreased by $2.0 million, bringing the total to $84.3 million in guarantees outstanding at April 27, 2012. No amounts have been recorded for these guarantees in the financial statements.

Other

The Company’s and the Utility’s access to capital markets, including the commercial paper market, and their respective financing costs, may depend on the credit rating of the entity that is accessing the capital markets. The credit ratings of the Company and the Utility remain at investment grade, but are subject to review and change by the rating agencies.

Utility capital expenditures were $40.5 million for the six months ended March 31, 2012, compared with $29.6 million for the same period last year. The increase in capital expenditures, compared with the prior period, is primarily attributable to additional expenditures for distribution plant and information technology investments. During fiscal 2011, Laclede Gas began a multi-year project to enhance its technology, customer service, and business processes by replacing its existing work management, financial, and supply chain software applications. Non-utility capital expenditures were $0.1 million for six months ended March 31, 2012 and 2011.

Consolidated capitalization at March 31, 2012 consisted of 64.4% Laclede Group common stock equity and 35.6% Laclede Gas long-term debt.

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, which primarily include capital expenditures, scheduled maturities of long-term debt, short-term seasonal needs, and dividends.

The seasonal nature of Laclede Gas’ sales affects the comparison of certain balance sheet items at March 31, 2012 and at September 30, 2011, such as Accounts receivable - net, Gas stored underground, Notes payable, Accounts payable, Regulatory assets and Regulatory liabilities, and Advance and Delayed customer billings. The Consolidated Balance Sheet at March 31, 2011 is presented to facilitate comparison of these items with the corresponding interim period of the preceding fiscal year.

CONTRACTUAL OBLIGATIONS

As of March 31, 2012, Laclede Group had contractual obligations with payments due as summarized below (in millions):

			Payments due by period
			Remaining						Fiscal Years
Contractual Obligations	Total		Fiscal Year 2012		Fiscal Years 2013-2014		Fiscal Years 2015-2016		2017 and thereafter
Principal Payments on Long-Term Debt	$	365.0	$	—	$	25.0	$	—	$	340.0
Interest Payments on Long-Term Debt		449.6		11.4		43.5		42.7		352.0
Capital Leases (a)		0.3		0.1		0.1		0.1		—
Operating Leases (a)		9.2		2.1		6.3		0.8		—
Purchase Obligations – Natural Gas (b)		393.9		197.7		173.5		15.3		7.4
Purchase Obligations – Other (c)		88.3		24.7		23.4		18.4		21.8
Total (d)	$	1,306.3	$	236.0	$	271.8	$	77.3	$	721.2

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(a)	Lease obligations are primarily for office space, office equipment, vehicles, and power operated equipment in the Regulated Gas Distribution segment. Additional payments will be incurred if renewal options are exercised under the provisions of certain agreements.
(b)	These purchase obligations represent the minimum payments required under existing natural gas transportation and storage contracts and natural gas supply agreements in the Regulated Gas Distribution and Non-Regulated Gas Marketing segments. These amounts reflect fixed obligations as well as obligations to purchase natural gas at future market prices, calculated using March 31, 2012 forward market prices. Laclede Gas recovers the costs related to its purchases, transportation, and storage of natural gas through the operation of its PGA Clause, subject to prudence review by the MoPSC; however, variations in the timing of collections of gas costs from customers affect short-term cash requirements. Additional contractual commitments are generally entered into prior to or during the heating season.
(c)	These purchase obligations primarily reflect miscellaneous agreements for the purchase of materials and the procurement of services necessary for normal operations.
(d)	The category of Other Long-Term Liabilities has been excluded from the table above because there are no material amounts of contractual obligations under this category. Long-term liabilities associated with unrecognized tax benefits, totaling $5.9 million, have been excluded from the table above because the timing of future cash outflows, if any, cannot be reasonably estimated. Also, commitments related to pension and postretirement benefit plans have been excluded from the table above. At this writing, the Company expects to make contributions to its qualified, trusteed pension plans of at least $10.5 million during the remaining six months of fiscal year 2012. Laclede Gas anticipates a $4.7 million contribution relative to its non-qualified pension plans during the remaining six months of fiscal year 2012. With regard to the postretirement benefits, the Company anticipates Laclede Gas will contribute $9.0 million to the qualified trusts and $0.2 million directly to participants from Laclede Gas’ funds during the remaining six months of fiscal year 2012. For further discussion of the Company’s pension and postretirement benefit plans, refer to Note 2, Pension Plans and Other Postretirement Benefits, of the Notes to Consolidated Financial Statements.

MARKET RISK

Commodity Price Risk

Laclede Gas’ commodity price risk, which arises from market fluctuations in the price of natural gas, is primarily managed through the operation of its PGA Clause. The PGA Clause allows Laclede Gas to flow through to customers, subject to prudence review by the MoPSC, the cost of purchased gas supplies. The Utility is allowed the flexibility to make up to three discretionary PGA changes during each year, in addition to its mandatory November PGA change, so long as such changes are separated by at least two months. The Utility is able to mitigate, to some extent, changes in commodity prices through the use of physical storage supplies and regional supply diversity. Laclede Gas also has a risk management policy that allows for the purchase of natural gas derivative instruments with the goal of managing its price risk associated with purchasing natural gas on behalf of its customers. This policy prohibits speculation. 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 PGA Clause. Accordingly, Laclede Gas does not expect any adverse earnings impact as a result of the use of these derivative instruments. However, the timing of recovery for cash payments related to margin requirements may cause short-term cash requirements to vary. Nevertheless, carrying costs associated with such requirements, as well as other variations in the timing of collections of gas costs, are recovered through the PGA Clause. For more information about the Utility’s natural gas derivative instruments, see Note 7, Derivative Instruments and Hedging Activities, of the Notes to Consolidated Financial Statements.

In the course of its business, Laclede Group’s non-regulated gas marketing subsidiary, LER, enters into contracts to purchase and sell natural gas at fixed prices and natural gas index-based prices. Commodity price risk associated with these contracts has the potential to impact earnings and cash flows. To minimize this risk, LER has a risk management policy that provides for daily monitoring of a number of business measures, including fixed price commitments. In accordance with the risk management policy, LER manages the price risk associated with its fixed-price commitments. This risk is currently managed either by closely matching the offsetting physical purchase or sale of natural gas at fixed-prices or through the use of natural gas futures and swap contracts traded on or cleared through the NYMEX and ICE to lock in margins. At March 31, 2012, LER’s unmatched fixed-price positions were not material to Laclede Group’s financial position or results of operations.

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As mentioned above, LER uses natural gas futures, swap, and option contracts traded on or cleared through the NYMEX and ICE to manage the commodity price risk associated with its fixed-price natural gas purchase and sale commitments. These derivative instruments may be designated as cash flow hedges of forecasted purchases or sales. Such accounting treatment generally permits a substantial portion of the gain or loss to be deferred from recognition in earnings until the period that the associated forecasted purchase or sale is recognized in earnings. To the extent a hedge is effective, gains or losses on the derivatives will be offset by changes in the value of the hedged forecasted transactions. Information about the fair values of LER’s exchange-traded/cleared natural gas derivative instruments is presented below:

(Thousands)	Derivative Fair Values			Cash Margin			Derivatives and Cash Margin
Net balance of derivative assets at September 30, 2011	$	209		$	1,100		$	1,309
Changes in fair value		9,472			—			9,472
Settlements/purchases - net		(7,613	)		—			(7,613	)
Changes in cash margin		—			(1,557	)		(1,557	)
Net balance of derivative assets at March 31, 2012	$	2,068		$	(457	)	$	1,611

	At March 31, 2012
	Maturity by Fiscal Year
(Thousands)		Total			2012			2013			2014
Fair values of exchange-traded/cleared natural gas derivatives - net	$	2,068		$	420		$	1,701		$	(53	)
MMBtu – net (short) long futures/swap/option positions		(7,880	)		(2,638	)		(5,342	)		100

Certain of LER’s physical natural gas derivative contracts are designated as normal purchases or normal sales, as permitted by GAAP. This election permits the Company to account for the contract in the period the natural gas is delivered. Contracts not designated as normal purchases or normal sales, including those designated as trading activities, are accounted for as derivatives with changes in fair value recognized in earnings in the periods prior to settlement. Below is a reconciliation of the beginning and ending balances for physical natural gas contracts accounted for as derivatives, none of which will settle beyond fiscal year 2013:

(Thousands)
Net balance of derivative assets at September 30, 2011	$	1,923
Changes in fair value		1,478
Settlements		(171	)
Net balance of derivative assets at March 31, 2012	$	3,230

For further details related to LER’s derivatives and hedging activities, see Note 7, Derivative Instruments and Hedging Activities, of the Notes to Consolidated Financial Statements.

Counterparty Credit Risk

LER has concentrations of counterparty credit risk in that a significant portion of its transactions are with (or are associated with) energy producers, utility companies, and pipelines. These concentrations of counterparties have the potential to affect the Company’s overall exposure to credit risk, either positively or negatively, in that each of these three groups may be affected similarly by changes in economic, industry, or other conditions. LER also has concentrations of credit risk with certain individually significant counterparties. To the extent possible, LER enters into netting arrangements with its counterparties to mitigate exposure to credit risk. Although not recorded on the consolidated balance sheets, LER is also exposed to credit risk associated with its derivative contracts designated as normal purchases and normal sales. LER closely monitors its credit exposure and, although uncollectible amounts have not been significant, increased counterparty defaults are possible and may result in financial losses and/or capital limitations. For more information on these concentrations of credit risk, including how LER manages these risks, see Note 8, Concentrations of Credit Risk, of the Notes to Consolidated Financial Statements.

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Interest Rate Risk

The Company is subject to interest rate risk associated with its long-term and short-term debt issuances. Based on average short-term borrowings during the six months ended March 31, 2012, an increase of 100 basis points in the underlying average interest rate for short-term debt would have caused an increase in interest expense of approximately $0.8 million on an annual basis. Portions of such increases may be offset through the application of PGA carrying costs. At March 31, 2012, Laclede Gas had fixed-rate long-term debt totaling $365 million (including current maturities). While these long-term debt issues are fixed-rate, they are subject to changes in fair value as market interest rates change. However, increases or decreases in fair value would impact earnings and cash flows only if Laclede Gas were to reacquire any of these issues in the open market prior to maturity. Under GAAP applicable to Laclede Gas’ regulated operations, losses or gains on early redemptions of long-term debt would typically be deferred as regulatory assets or regulatory liabilities and amortized over a future period.

ENVIRONMENTAL MATTERS

Laclede Gas owns and operates natural gas distribution, transmission and storage facilities, the operations of which are subject to various environmental laws, regulations and interpretations. While environmental issues resulting from such operations arise in the ordinary course of business, such issues have not materially affected the Company’s or Laclede Gas’ financial position and results of operations. As environmental laws, regulations, and their interpretations change, however, Laclede Gas may be required to incur additional costs. For information relative to environmental matters, see Note 11, Commitments and Contingencies, of the Notes to Consolidated Financial Statements.

OFF-BALANCE SHEET ARRANGEMENTS

Laclede Group has no off-balance sheet arrangements.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

For this discussion, see Part I., Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Market Risk, on page 43 of this report.

Item 4. Controls and Procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15e and Rule 15d-15e under the Securities Exchange Act of 1934, as amended. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective.

There have been no changes in our internal control over financial reporting that occurred during our second fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

For a description of environmental matters and legal proceedings, see Note 11, Commitments and Contingencies, of the Notes to Consolidated Financial Statements. For a description of pending regulatory matters of Laclede Gas, see Part I., Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Regulatory and Other Matters, on page 38 of this report.

Laclede Group and its subsidiaries are involved in litigation, claims and investigations arising in the normal course of business. Management, after discussion with counsel, believes that the final outcome of these matters will not have a material adverse effect on the consolidated financial position or results of operations of the Company.

Item 1A. Risk Factors

The following paragraphs should be read in conjunction with the risk factors included in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended September 30, 2011.

RISKS THAT RELATE TO THE NON-REGULATED GAS MARKETING SEGMENT

Increased competition, fluctuations in natural gas commodity prices, and pipeline infrastructure projects may adversely impact LER’s future profitability.

Competition in the marketplace and fluctuations in natural gas commodity prices have a direct impact on LER’s business. Changing market conditions and prices, the narrowing of regional and seasonal price differentials, and limited future price volatility may adversely impact LER’s sales margins or affect LER’s ability to procure gas supplies and/or to serve certain customers, which may reduce sales profitability and/or increase certain credit requirements caused by reductions in netting capability. Although the FERC regulates the interstate transportation of natural gas and establishes the general terms and conditions under which LER may use interstate gas pipeline capacity to purchase and transport natural gas, LER must occasionally renegotiate its transportation agreements with a concentrated group of pipeline companies. Renegotiated terms of new agreements may impact LER’s future profitability. Profitability may also be adversely impacted if pipeline capacity or future storage capacity secured by LER is not fully utilized and/or its costs are not fully recovered.

Risk management policies, including the use of derivative instruments, may not fully protect LER’s sales and results of operations from volatility and may result in financial losses.

In the course of its business, LER enters into contracts to purchase and sell natural gas at fixed prices and index-based prices. Commodity price risk associated with these contracts has the potential to impact earnings and cash flows. To minimize this risk, LER has a risk management policy that provides for daily monitoring of a number of business measures, including fixed price commitments. LER currently manages the commodity price risk associated with fixed-price commitments for the purchase or sale of natural gas by either closely matching the offsetting physical purchase or sale of natural gas at fixed prices or through the use of natural gas futures and swap contracts traded on or cleared through the NYMEX and ICE to lock in margins. These exchange-traded/cleared contracts may be designated as cash flow hedges of forecasted transactions. However, market conditions and regional price changes may cause ineffective portions of matched positions to result in financial losses. Additionally, to the extent that LER’s natural gas commitments do not qualify for the normal purchases or normal sales designation (or the designation is not elected), the contracts are recorded as derivatives at fair value each period. Accordingly, the associated gains and losses are reported directly in earnings and may cause volatility in results of operations. Gains or losses (realized and unrealized) on certain wholesale purchase and sale contracts may be required to be presented on a net basis (instead of a gross basis) in the statements of consolidated income. Such presentation could result in reductions to and/or volatility in the Company’s operating revenues.

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Item 5. Other Information

At its meeting on April 26, 2012, the Board of Directors of The Laclede Group, Inc. approved revisions to Article III of the Company’s bylaws.  As amended, the bylaws:

• Allow shareholders representing one-fourth of the Company’s outstanding shares to call a special meeting of shareholders (previously the threshold was one-third of the outstanding shares);

• Limit the business at a special meeting to the matters identified in the notice for the meeting;

• Require advance notice of shareholder nominees or proposals 90-120 days in advance of the annual meeting date (previously the notice time frame was 60-90 days in advance of the meeting date); and

• Increase the detail required to be provided relative to any shareholder proponent and shareholder nominee.

The bylaws are attached as Exhibit 3.2 to this Form 10-Q.

At its meeting on April 26, 2012, the Board also named certain officers to new executive positions.  Effective May 1, 2012, Mr. Mark D. Waltermire, age 53, was appointed Executive Vice President, Chief Financial Officer of the Company and Mr. Steven P. Rasche, age 51, was promoted to Senior Vice President – Finance and Accounting of the Company and will serve as its principal accounting officer.  Mr. Rasche also was appointed Chief Financial Officer of Laclede Gas and will serve as its principal accounting officer.  Additionally, Mr. Michael R. Spotanski, age 52, was appointed Senior Vice President, Chief Integration and Innovation Officer,of the Company.  He previously served as Senior Vice President Operations and Marketing of Laclede Gas, and will continue to manage the Utility’s operations, along with Ms. Sitherwood who continues to serve as President of the Utility, until a new operating officer is appointed for Laclede Gas.  For a description of their experience over the past five years, see “Executive Officers of the Registrant”, after Part I, Item 3 of the Company’s annual report on Form 10-K for its fiscal year 2011, incorporated herein by reference.  The Company announced other executive appointments in its press release dated April 27, 2012.

Item 6. Exhibits

(a) See Exhibit Index

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SIGNATURE

Pursuant to the requirements 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.

		The Laclede Group, Inc.
Dated:	April 27, 2012	By:	/s/ Mark D. Waltermire
			Mark D. Waltermire
			Chief Financial Officer
			(Authorized Signatory and Chief Financial Officer)

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INDEX TO EXHIBITS

Exhibit No.
3.2	-	Bylaws of The Laclede Group, Inc. as amended April 26, 2012
10.1	-	The Laclede Group 2006 Equity Incentive Plan, as amended effective February 1, 2012
12	-	Ratio of Earnings to Fixed Charges.
31	-	CEO and CFO Certifications under Exchange Act Rule 13a – 14(a).
32	-	CEO and CFO Section 1350 Certifications.

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EX-3.2

Exhibit 3.2

BYLAWS

OF

THE LACLEDE GROUP, INC.

(April 26, 2012)

ARTICLE I

OFFICES

Section 1.  Principal Office.  The principal office of The Laclede Group, Inc. (“Company”) shall be at such place as the Board of Directors may from time to time determine, but until a change is effected, such principal office shall be at 720 Olive Street in the City of St. Louis, Missouri.

Section 2.  Other Offices.  The Company may also have offices at such other places both within and without the State of Missouri as the Board may, from time to time, determine or the business of the Company may require.

ARTICLE II

SEAL

The corporate seal shall have inscribed thereon the name of the Company and the words “Seal, St. Louis, Missouri.”  The seal may be used by causing it, or a facsimile thereof, to be impressed, affixed or reproduced.

ARTICLE III

SHAREHOLDERS’ MEETINGS

Section 1.  Annual Meetings.  The annual meeting of the shareholders of the Company shall be held at 10 o’clock A.M. on the last Thursday of January in each year if not a legal holiday, and if a legal holiday, then on the next succeeding business day not a legal holiday.  The purpose of the meeting shall be to elect directors and to transact such other business as properly brought before the meeting.  If the Company fails to hold said meeting for the election of directors on the date aforesaid, the Board of Directors shall cause the election to be held by the shareholders as soon thereafter as convenient.

Section 2.  Special Meetings.  Special meetings of the shareholders may be called by or at the request of the Chairman of the Board, Chief Executive Officer or a majority of the number of Directors which the Company would have if there were no vacancies.  Also, the Secretary shall call any such special meeting whenever requested in writing so to do by the holders of record of not less than one-fourth of the shares of the capital stock of the Company then outstanding and entitled to vote thereat.  A shareholder request for a special meeting shall state the purposes(s) of the proposed meeting and shall include the same information required for business to be properly brought by a shareholder before the annual meeting of shareholders as set forth in this Article III of these Bylaws with respect to any director nominations or other business proposed to be presented at such special meeting and as to the shareholder(s) requesting such meeting.  Business transacted at a special meeting requested by shareholders shall be limited to the purposes(s) stated in the request; provided, however, that nothing in these Bylaws shall prohibit the Board of Directors from submitting matters to the shareholders at any special meeting requested by shareholders.

Notwithstanding the foregoing, the Secretary shall not be required to call a special meeting of shareholders if (i) the Board of Directors calls an annual or special meeting of shareholders to be held not later than 60 days after the date on which a valid shareholder request has been delivered to the Secretary

(the “Delivery Date”); or (ii) the shareholder request (A) contains an identical or substantially similar item (a “Similar Item”) to an item that was presented at any meeting of shareholders held within 120 days prior to the Delivery Date (and, for purposes of this clause (A) the election of directors shall be deemed a Similar Item with respect to all items of business involving the election or removal of directors); (B) relates to an item of business that is not a proper subject for action by the party requesting the special meeting under applicable law as determined in the reasonable judgment of the Board of Directors; (C) was made in a manner that involved a violation of Regulation 14A under the Securities Exchange Act of 1934( the “Exchange Act”), or other applicable law; or (D) does not comply with the provisions of Article III of these Bylaws.

Section 3.  Notices of Meetings.  Notice of each meeting of the shareholders stating the place, date and hour of the meeting, and, in case of a special meeting or where otherwise required by statute, the purpose or purposes for which the meeting is called, shall be sent or otherwise given in accordance with Section 4 of this Article not less than ten nor more than seventy days before the date of the meeting, by or at the direction of the person calling the meeting, to each shareholder entitled to vote at such meeting.

Section 4.  Method of Notice.  Notice of any meeting of shareholders shall be given either personally or by mail, telecopy, telegram or other electronic or wireless means.  Notices not personally delivered shall be sent charges prepaid and shall be addressed to the shareholder at the address of that shareholder appearing on the books of the Company.  Notice shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by telecopy, telegram or other electronic or wireless means.

An affidavit of the mailing or other means of giving notice of any shareholders’ meeting, executed by the Secretary, Assistant Secretary or any transfer agent of the Company giving the notice, shall be prima facie evidence of the giving of such notice.

Section 5.  Place of Meetings.  Meetings of the Company’s shareholders may be held at such place, either within or without the State of Missouri, as may be fixed from time to time by resolution of the Board of Directors and designated in the notice of meeting.

Section 6.  Quorum: Adjournments.  The holders of a majority of the shares issued and outstanding and entitled to vote, present in person or represented by proxy, shall constitute a quorum at a meeting of the shareholders for the transaction of business, except as otherwise required by law, the Articles of Incorporation, as they may be amended (hereinafter the “Charter”), or these Bylaws.  The shareholders present at a meeting at which a quorum is present may continue to transact business until adjournment, notwithstanding the withdrawal of such number of shareholders as to reduce the number of remaining shareholders to less than a quorum.  The absence from any meeting of the number of shares required by law, the Charter or these Bylaws for action upon one matter shall not prevent action at such meeting upon any other matter or matters which may properly come before the meeting, if the number of shares required in respect of such other matters shall be present.

Whether or not a quorum is present, the chairman of the meeting or a majority of the shareholders entitled to vote thereat, present in person or represented by proxy, shall have power, except as otherwise provided by statute, successively to adjourn the meeting to such time and place as they may determine, to a date not longer than ninety days after each such adjournment, and no notice of any such adjournment need be given to shareholders other than the announcement of the adjournment at the meeting.

Section 7.  Voting: Proxies.  At each meeting of the shareholders, each shareholder of record entitled to vote thereat may vote in person or by written proxy.  A written proxy may be in the form of a telegram, cablegram or other means of electronic transmission signed by the shareholder and filed with the Secretary of the Company.  If the instrument designates two (2) or more persons to act as proxies, a majority of the proxies present at the meeting may exercise all of the powers conferred by the instrument, unless the instrument provides otherwise.  No proxy shall be valid after eleven months from the date of its execution, unless otherwise provided in the proxy.  A proxy shall be deemed signed if the shareholder’s name is placed on the proxy (whether by manual signature, typewriting, telegraphic transmission or otherwise) by the shareholder or the shareholder’s attorney-in-fact.

2

In voting on any proposition including the election of directors, each shareholder shall have one vote for each share of stock which he or she is entitled to vote on such proposition, and, except as otherwise provided by law, the Charter or these Bylaws, the affirmative vote of a majority of the shares entitled to vote and present in person or represented by proxy at the meeting shall be the act of the shareholders.

The date for determining the shareholders entitled to vote at a meeting shall be determined pursuant to Article IX, Section 3 of these Bylaws.

Section 8.  Organization.  Every meeting of the shareholders for whatever purpose shall be convened by the Chairman of the Board, Chief Executive Officer, Secretary or other officer or person calling the meeting, and in the absence of such officer or person the meeting may be convened by any officer of the Company, and in the absence of an officer of the Company, the meeting may be convened by the person duly elected chairman of such meeting.  Except as otherwise provided in these Bylaws, the officer or person convening the meeting shall act as chairman thereof.  The Secretary of the Company shall act as secretary of all meetings of shareholders and in his or her absence the chairman of the meeting may designate an assistant secretary of the Company or another person to act as secretary of the meeting.

Except as may otherwise be required by applicable law or by rules and regulations adopted by the Board of Directors, the chairman of any meeting of shareholders shall prescribe such rules, regulations and procedures and do such acts, including causing the adjournment of the meeting without a vote of shareholders, that the chairman deems appropriate.  Such rules, regulations or procedures, whether adopted by the Board or prescribed by the chair of the meeting, may include, but are not limited to, the following:  (a) the establishment of an agenda or order of business for the meeting, including fixing the time for opening and closing the polls for voting on each matter; (b) rules and procedures for maintaining order at the meeting and the safety of those present; (c) limitations on attendance at or participation in the meeting to shareholders of record of the Company, their duly authorized and constituted proxies or such other persons as the chair shall permit; (d) restrictions on entry to the meeting after the time fixed for commencement thereof; and (e) limitation on the time allotted for questions or comments by participants.  No nominations of persons for election to the Company’s Board of Directors shall be made, and no business shall be conducted, at a meeting of shareholders except in accordance with the procedures set forth in Sections 9 and 10 of this Article III of these Bylaws.  Unless and to the extent determined by the Board or the chair of the meeting, meetings of shareholders shall not be required to be held in accordance with rules of parliamentary procedure.

Section 9.  Notice of Shareholder Nominees for Directors.  Only persons who are nominated in accordance with the procedures set forth in this Section shall be eligible for election as directors of the Company, except as may be otherwise provided in the Charter with respect to the rights of holders of preferred stock of the Company to nominate and elect a specified number of directors in certain circumstances.  Nominations of persons for election to the Board of Directors of the Company may be made at any annual meeting of shareholders or at any special meeting of shareholders called for the purpose of electing directors: (a) by or at the direction of the Board of Directors (or any duly authorized committee thereof); or (b) by any shareholder of the Company entitled to vote at such meeting for the election of directors and who complies with the procedures set forth in this Section.  In addition to any other applicable requirements, for a nomination to be made by a shareholder, such shareholder must have given timely notice thereof in proper written form to the Secretary of the Company, as described in this Section, which notice is not withdrawn by such shareholder at or prior to such meeting.

To be timely, a shareholder’s notice must be delivered or mailed to, and received by, the Secretary of the Company at the principal executive offices of the Company: (a) in the case of an annual meeting of shareholders, not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of shareholders; provided, however, that in the event that the date of the annual meeting is changed by more than 30 days from such anniversary date, notice by the shareholder to be timely must be so received not later than the close of business on the 10th day following the earlier of the date on which such notice of the date of the annual meeting was sent or public disclosure of the date of the annual meeting was made; and (b) in the case of a special meeting of shareholders called for the purpose of electing directors, not later than the close of business of the 10th day following the earlier of the date on which such notice of the date of the special meeting was sent or public disclosure of the date of the special meeting was made.  In no event shall the public disclosure of an adjournment of a shareholders’ meeting commence a new time period for the giving of a shareholder’s notice as described in this Section 9.  For purposes of this Section 9, “public disclosure” shall mean disclosure in a press release reported by the Dow

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Jones News Service, Associated Press or a comparable national news service or in a document filed by the Company with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act or any successor law or agency rule.

To be in proper written form, a shareholder’s notice must set forth in writing: (a) as to each person whom the shareholder proposes to nominate for election as a director (the “Proposed Nominee”): (i) the name, age, business address and residence address of the Proposed Nominee; (ii) the principal occupation or employment of such Proposed Nominee for the previous five years, (iii) the class or series and number of shares of the Company’s capital stock owned beneficially or of record by Proposed Nominee, (iv) Proposed Nominee’s written consent to being named in a proxy statement as a nominee and to serving as a director if elected, and (v) any other information relating to Proposed Nominee that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors, pursuant to Section 14 of the Exchange Act, and the rules and regulations promulgated thereunder; and (b) as to each shareholder giving the notice and the beneficial owner of Company stock, if any, on whose behalf the nomination is made (“Beneficial Owner”): (i) the name and address, as they appear on the Company’s shareholder records, of such shareholder and any such Beneficial Owner; (ii) the class or series and number of shares of the Company’s capital stock which are owned beneficially and of record by such shareholder and any such Beneficial Owner and a representation that such shareholder will notify the Company in writing of the class, series and number of such shares owned of record and beneficially as of the record date for the meeting by such shareholder and any Beneficial Owner, promptly following the later of the record date or the date notice of the record date is first publicly disclosed; (iii) a description of all arrangements or understandings between such shareholder or Beneficial Owner and each Proposed Nominee and any other person or persons (including their names) pursuant to which the nomination(s) are to be made by such shareholder or Beneficial Owner and an undertaking that such shareholder and any such Beneficial Owner will notify the Company in writing of any such arrangement or understanding  in effect as of the record date for the meeting promptly following the later of the record date or the date notice of the record date is first publicly disclosed, (iv) a representation that such shareholder or Beneficial Owner is entitled to vote at the meeting and intends to appear in person or by proxy to nominate the Proposed Nominee; (v) any personal or other direct or indirect material interest of the shareholder and Beneficial Owner in the nomination; (vi) a description of any agreement, arrangement or understanding (including any derivative or short positions, profit interests, options, warrants, stock appreciation or similar rights, hedging transactions, and borrowed or loaned shares) that has been entered into as of the date of the shareholder’s notice by, or on behalf of, the shareholder and Beneficial Owner, the effect or intent of which is to mitigate loss to, manage risk or benefit of a share price change for, or maintain, increase or decrease the voting power of, such shareholder or such Beneficial Owner with respect to shares of capital stock of the Company, and an undertaking that the shareholder will notify the Company in writing of any such agreement, arrangement or understanding in effect, including any change in an agreement, arrangement or understanding previously reported to the Company,  as of the record date for the meeting promptly following the later of the record date or the date notice of the record date is first publicly disclosed; (vii) a representation whether such shareholder or Beneficial Owner intends to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the capital stock of the Company required to elect the proposed nominee and/or otherwise to solicit proxies from stockholders in support of the nomination; and (viii) any other information relating to such shareholder or Beneficial Owner that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors and regulations promulgated thereunder.

In the event that a shareholder seeks to nominate one or more directors, the chairman of the meeting shall determine whether a shareholder has complied with this Section.  The chairman of the meeting shall, if the facts warrant, determine and declare to the meeting that a nomination(s) was not properly brought before the meeting in accordance with this Section 9, and the defective nomination shall be disregarded.  The chairman’s ruling thereon shall be final and conclusive.

Notwithstanding anything in these Bylaws to the contrary, no election of a director nominated by a shareholder shall become effective until the final termination of any proceeding that may have been commenced in any court of competent jurisdiction for an adjudication of any legal issues incident to determining the procedure pursuant to which the nomination of such director was brought before the shareholders, unless and until such court shall have determined that such proceedings are not being pursued expeditiously and in good faith.

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Section 10.  Procedures for Submission of Shareholder Proposals at Shareholders’ Meetings.  At a meeting of the shareholders of the Company, only such business shall be conducted as shall have been brought before the meeting: (i) pursuant to the Company’s notice of the meeting, (ii) by or at the direction of the Board of Directors (or a committee thereof); or (iii) by any shareholder of record of the Company entitled to vote on such business at such meeting who complies with the procedures set forth in this Section.  In addition to any other requirements, for business properly to be brought before a meeting by a shareholder, the shareholder must have given timely notice thereof in proper written form to the Secretary of the Company as described in this Section, which notice is not withdrawn by such shareholder at or prior to such meeting.

To be timely, a shareholder’s notice must be delivered or mailed to, and received by, the Secretary of the Company at the principal executive offices of the Company: (a) in the case of an annual meeting of shareholders, not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of shareholders; provided, however, that in the event that the date of the annual meeting is changed by more than 30 days from such anniversary date, notice by the shareholder to be timely must be so received not later than the close of business on the 10th day following the earlier of the date on which notice of the date of the annual meeting was sent or public disclosure of the date of the annual meeting was made; and (b) in the case of a special meeting of shareholders, not later than the 10th day following the earlier of the date on which such notice of the date of the special meeting was sent or public disclosure of the date of the special meeting was made.  In no event shall the public disclosure of an adjournment of a meeting commence a new time period for the giving of a shareholder’s notice as described in this Section 10.

For purposes of this Section 10, “public disclosure” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or a comparable national news service or in a document filed by the Company with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act or any successor law or agency rule.

To be in proper written form, a shareholder’s notice must set forth in writing as to each matter the shareholder proposes to bring before the meeting of shareholders: (i) a brief description of the business desired to be brought before the meeting, including the complete text of any resolutions and any amendment to any Company document intended to be presented at the meeting of shareholders; (ii) the name and address, as they appear on the Company’s shareholder records, of the shareholder proposing such business and of the beneficial owner, if any, on whose behalf the proposal is made (Proposal Beneficial Owner); (iii) the class or series and number of shares of the Company’s capital stock that are owned beneficially and of record by such shareholder and any such Proposal Beneficial Owner (and a representation that such shareholder will notify the Company in writing of the class, series and number of such shares owned of record and beneficially as of the record date for the meeting by such shareholder and any Proposal Beneficial Owner, promptly following the later of the record date or the date notice of the record date is first publicly disclosed; (iv) any personal or other direct or indirect material interest of the shareholder and Proposal Beneficial Owner in the business to be submitted; (v) a description of any agreement, arrangement or understanding (including any derivative or short positions, profit interests, options, warrants, stock appreciation or similar rights, hedging transactions, and borrowed or loaned shares) that has been entered into as of the date of the shareholder’s notice by, or on behalf of, the shareholder and Proposal Beneficial Owner, the effect or intent of which is to mitigate loss to, manage risk or benefit of a share price change for, or maintain, increase or decrease the voting power of, such shareholder or Proposal Beneficial Owner with respect to shares of capital stock of the Company, and an undertaking that the shareholder will notify the Company in writing of any such agreement, arrangement or understanding in effect, including any change in an agreement, arrangement or understanding previously reported to the Company,  as of the record date for the meeting promptly following the later of the record date or the date notice of the record date is first publicly disclosed; (vi) a representation that such shareholder or Proposal Beneficial Owner is entitled to vote at the meeting and intends to appear in person or by proxy to bring such business before the meeting; (vii) a representation whether such shareholder or Proposal Beneficial Owner intends to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the capital stock to the Company required to approve such proposed business and/or otherwise to solicit proxies from stockholders in support of the business; and (viii)  any other information relating to such shareholder, Proposal Beneficial Owner or matters to be brought before the meeting.

Notwithstanding anything in these Bylaws to the contrary, no business shall be conducted at a meeting of shareholders, except in accordance with the procedures set forth in Section 9 or Section 10 of

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this Article III of these Bylaws.  The chairman of the meeting shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 10 and, if he or she should so determine and declare, any such business not properly brought before the meeting shall not be transacted.  If, however, the shareholder does not appear at the meeting, the proposal shall not be presented for a vote at the meeting, even though proxies regarding that vote have been received by the Company.  The chairman’s ruling thereon shall be final and conclusive.  Notwithstanding any of the foregoing provisions of this Section 10, a shareholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder (or any successor law or agency rule) with respect to the matters set forth in this Section 10.  Nothing in this Section 10 shall be deemed to affect any rights of shareholders to request inclusion of proposals in the Company’s proxy statement pursuant to Rule 14a-8 under the Exchange Act (or any successor law or agency rule).

Notwithstanding anything in these Bylaws to the contrary, no business brought before a meeting of the shareholders by a shareholder shall become effective until the final termination of any proceeding that may have been commenced in any court of competent jurisdiction for an adjudication of any legal issues incident to determining the validity of such business and the procedure pursuant to which it was brought before the shareholders, unless and until such court shall have determined that such proceedings are not being pursued expeditiously and in good faith.

ARTICLE IV

DIRECTORS

Section 1.  General Powers.  The Board of Directors shall control and manage the property, business and affairs of the Company.  The Board of Directors may also exercise all such powers of the Company and do all such lawful acts and things as are not by law, the Charter or these Bylaws directed or required to be exercised or done by the shareholders or some particular officer of the Company.

Section 2.  Number, Classification and Term of Office.  The number of directors shall be fixed from time to time by resolution of the Board of Directors provided that in no event shall the number of directors be less than 7 nor more than 12.

The directors shall be elected in three classes, as nearly equal in number as possible (with one such class to be elected annually, and with each class of directors to serve until the third annual meeting of shareholders after the meeting at which such class of directors is elected).  All directors shall serve for their respective terms and until their respective successors shall be duly elected and qualified.

In the event of any increase in the number of directors, the additional director(s) shall be added to such class(es) as may be necessary so that all classes shall be as nearly equal as may be possible.  In the event of any decrease in the number of directors, all classes of directors shall be decreased as nearly equally as may be possible; provided that no decrease in the number of directors or reclassification of the Board caused by such reduction in the number of directors shall shorten the term of any incumbent director.  Subject to the foregoing, the Board shall determine the class(es) to which any additional director(s) shall be added and the class(es) which shall be increased or decreased in the event of any increase or decrease in the number of director(s).

In case of any vacancy or vacancies in the Board of Directors, the Board of Directors by a vote of a majority of the remaining directors may fill the vacancy or vacancies for the unexpired term.  A vacancy that will occur at a specified later date, by reason of a resignation effective at a later date, may be filled before the vacancy occurs, but the new director shall not take office until the vacancy occurs.

Section 3.  Compensation.  Directors who are not officers or employees of the Company may receive for their service as directors such annual compensation as may be determined by resolution of the Board of Directors.  In addition, all directors as such shall receive their expenses, if any, for attending meetings of the Board of Directors and may receive a fixed sum for attendance as may be determined by resolution of the Board of Directors; provided, that nothing herein contained shall be construed to preclude any director from serving the Company in any other capacity and receiving compensation therefor.

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Members of special or standing committees of the Board of Directors shall receive their expenses, if any, for attending committee meetings and may receive a fixed sum for attendance at committee meetings as may be determined by resolution of the Board of Directors.

Section 4.  Qualifications.  Directors need not be shareholders of the Company.  At least one director shall be a bona fide citizen and resident of the State of Missouri.  A director shall retire from the Board at the annual meeting of shareholders’ following the director’s 75th birthday.

ARTICLE V

MEETINGS OF THE BOARD OF DIRECTORS

Section 1.  Regular Annual Meeting.  A regular annual meeting of the Board, including newly elected directors, shall be held immediately following the annual meeting of shareholders and shall be held at the principal office of the Company, unless another time or place shall be fixed therefor by the directors.  No notice of such meeting shall be necessary to the directors in order, legally, to constitute a meeting, provided a majority of the whole Board shall be present.  In the event such annual meeting of the Board is not held at the time and place specified herein, or at such other time and place as may be fixed by the directors, the meeting may be held at such time and place as shall be specified in a notice given in the same manner as provided in Section 3(a) or (b) of this Article for special meetings or as specified in a written waiver signed by all of the directors.

Section 2.  Regular Meetings.  Additional regular meetings of the Board of Directors shall be held without notice if the times of such meetings are fixed by the Board.  If the time of a meeting is not so fixed by the Board, notice shall be given in the same manner as provided in Section 3(a) or (b) of this Article for special meetings.  Regular meetings of the Board may be held at any place within or without the State of Missouri that has been designated from time to time by resolution of the Board.  In the absence of such a designation, regular meetings shall be held at the principal executive office of the Company.

Section 3.  Special Meetings.  Special meetings of the Board of Directors may be called upon request of the Chairman of the Board, the Chief Executive Officer or three members of the Board of Directors.  The person(s) authorized to call a special meeting of the Board may fix the time and place of the meeting.  Notice of the time, place and purpose of such meeting shall be given by any one or more of the following methods, and the method used need not be the same for each director being notified:

(a)           written notice sent by mail at least three days prior to the meeting;

(b) personal service of the notice, telephonic notice or facsimile or other electronic or wireless transmission of the notice, in any case at least 24 hours prior to the date of the meeting.

Section 4.  Quorum: Voting: Adjournments.  At all meetings of the Board of Directors, a majority of the duly elected Board shall be necessary to constitute a quorum for the transaction of business, and no action shall be taken (except adjournment, as provided below, and to fill vacancies, as provided in Article IV, Section 2) until after a quorum has been established.  The act of a majority of the directors present at any meeting shall be the act of the Board of Directors, regardless of whether or not a quorum is present at the time such action is taken, except as may be otherwise specifically provided by the Charter or by these Bylaws.  In the absence of a quorum, a majority of the directors present shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

Section 5.  Telephonic Participation.  Members of the Board of Directors may participate in a meeting of the Board by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in the meeting in this manner shall constitute presence at such meeting.

Section 6.  Action by Written Consent.  Any action required or permitted to be taken at any meeting of the Board of Directors (or of any committee thereof) may be taken without a meeting if all

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members of the Board (or committee) consent thereto in writing, and the writing or writings are filed with the minutes of the proceedings of the Board (or committee).

Section 7.  Organization.  Meetings of the Board of Directors shall be presided over by the Chairman of the Board, if any, or in his or her absence by the chairman of the Executive Committee, if any, or in his or her absence by the Chief Executive Officer.  In the absence of all such directors, a chairman pro tem chosen by a majority of the directors present shall preside at the meeting.  The Secretary of the Company, or in his or her absence an Assistant Secretary or any person designated from time to time by the Board, shall act as its Secretary.

ARTICLE VI

COMMITTEES

Section 1.  Executive Committee.  The Board of Directors, by resolution adopted by a majority of the whole Board, may designate two or more from their number, in addition to the Chief Executive Officer, who shall be a member, to constitute an Executive Committee and may appoint a Chairman of the Executive Committee.  The Executive Committee, to the extent provided in said resolution, shall have and exercise all of the authority of the Board of Directors during the intervals between the meetings of the Board, including power to cause the seal of the Company to be affixed to all papers that may require it; but the Executive Committee shall not have the power or authority with respect to amending the Charter, adopting an agreement of merger or consolidation, or recommending to the shareholders the sale, lease or exchange of all or substantially all of the Company’s property or assets, nor shall the Executive Committee have the power or authority to declare a dividend.  A meeting of the Executive Committee may be held on call by the Chairman of the Executive Committee, the Chief Executive Officer or on the call of any three members of the Committee.  The Executive Committee may hold meetings and make rules for the conduct of its business and appoint such committees and assistants as it shall from time to time deem necessary.  A majority of the members of the Executive Committee shall constitute a quorum.  Any one or more members of the Executive Committee may participate by means of a conference telephone or similar communications equipment allowing all persons participating in the meeting to hear each other at the same time.  Participation by such means shall constitute presence in person at a meeting.

The Executive Committee shall keep a record of its proceedings, which shall be reported to the Board of Directors at the next regular meeting of the Board.

The Chief Executive Officer may designate from time to time a member of the Board of Directors to act as a member of the Executive Committee at any meeting or meetings thereof in the place of any member of the Executive Committee absent therefrom.

Section 2.  Other Committees.  The Board of Directors may, in its discretion, by resolution, appoint other committees, composed of two or more members, which shall have and may exercise such powers as shall be conferred or authorized by the resolution appointing them.  Unless otherwise provided by the Board, a majority of the members of any such committee shall constitute a quorum and the acts of a majority of the members present at a meeting at which a quorum is present shall be the act of such committee.  The Board shall have the power at any time to change the membership of any such committee, to fill vacancies and to discharge any such committee.

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ARTICLE VII

OFFICERS

Section 1.  Titles.  The officers of the Company shall be elected by the Board of Directors and shall consist of a Chairman of the Board, a President, at least one Vice President, a Secretary and a Treasurer.  The Chief Executive Officer shall be determined as provided in Article VIII, Section 2.  The Board may also elect one or more additional Vice Presidents, a Controller, one or more Assistant Treasurers, Assistant Secretaries, Assistant Controllers and such other officers as the Board may deem appropriate.  The following offices may not be held by the same person: President and Vice President, Chief Executive Officer and Vice President, President and Secretary, or Chief Executive Officer and Secretary.  Vice Presidents may be given distinctive designations such as Executive Vice President, Group Vice President, Senior Vice President and the like.

Section 2.  Election.  The Board shall elect the officers at the Board’s annual meeting.  The officers shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board.  In connection with the election of any officer of the Company, the Board may determine that such officers, in addition to the title of the office to which he or she is elected, shall have a further title such as Chief Administrative Officer, Chief Operating Officer or such other title as the Board may designate, and the Board may prescribe powers to be exercised and duties to be performed by any such officer to whom any such additional title of office is given in addition to those powers and duties provided for by these Bylaws for such office.

Section 3.  Removal.  Any officer or officers elected or appointed by the Board of Directors may be removed at any time, with or without cause, by the affirmative vote of a majority of the whole Board of Directors. Any vacancy occurring in any office may be filled only by the Board.

Section 4.  Salaries.  The salaries of all officers of the Company shall be fixed by the Board of Directors.

ARTICLE VIII

DUTIES OF OFFICERS

Section 1.  Chairman of the Board.  The Chairman of the Board (a) shall preside as chairman of all meetings of the Board of Directors and of the shareholders at which the Chairman shall be present, (b) shall be, ex-officio, a member of all standing Board Committees and (c) shall have such other powers, responsibilities and duties as shall be assigned by the Board.  In the absence or disability of the Chief Executive Officer or the President, the Chairman shall exercise all of the powers and discharge all of the duties of the Chief Executive Officer or the President.

Section 2.  Chief Executive Officer.  The Chief Executive Officer of the Company shall be that person designated by the Board of Directors from among the Chairman of the Board, the Chairman of the Executive Committee or the President.  In the absence of such a designation, the President shall be the Chief Executive Officer.  The Chief Executive Officer shall have general supervision and control over all of the business and property of the Company and shall be responsible at all times to the Board of Directors and the Executive Committee.  The Chief Executive Officer shall have the power to suspend any subordinate officer appointed by the Board until such Board may be convened.  The Chief Executive Officer shall have full authority in respect to the signing and execution of deeds, bonds, mortgages, contracts and other instruments of the Company.  In the absence or the disability of the Chairman of the Board or President, when the Chief Executive Officer is not the Chairman of the Board or President, the Chief Executive Officer shall exercise all of the powers and discharge all of the duties of the Chairman of the Board or the President, as applicable.  In the event the Chief Executive Officer shall fail or for any reason be unable to serve, the Board of Directors shall promptly act to fill such vacancy.

Section 3.  President.  The President shall be a director and shall have such powers, responsibilities and duties as shall be assigned by the Board of Directors, or, when he or she is not the Chief Executive Officer, by the Chief Executive Officer.  The President shall have equal authority with the

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Chief Executive Officer with respect to the signing and execution of deeds, bonds, mortgages, contracts and other instruments of the Company.  In the absence or disability of the Chief Executive Officer, when the Chief Executive Officer also serves as the Chairman of the Board and the President is not the Chief Executive Officer, the President shall exercise all of the powers and discharge all of the duties of the Chairman of the Board and Chief Executive Officer.

Section 4.  Vice-Presidents.  Each Vice President shall perform and exercise such duties and powers as shall be assigned to that Vice President by the Board of Directors, the Chairman of the Board, the Chief Executive Officer or the President.

Section 5.  Treasurer.  The Treasurer shall have charge of the funds of the Company; shall keep the same in depositories designated by the Board or by officers of the Company authorized by the Board to make such designations; shall cause said funds to be disbursed upon checks, drafts, bills of exchange or orders for payment of money signed in such manner as the Board or authorized officers of the Company may, from time to time, direct; shall perform such other duties as are incident to his or her office, or as may be prescribed by the Chief Executive Officer, President or the Board of Directors from time to time; and if required by the Board of Directors, give bond for the faithful discharge of his or her duties, in such form and amount and with such surety or sureties as may be determined by the Board of Directors.  The Assistant Treasurer(s), if any, shall, in the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer and shall have such other duties and powers as the Board may prescribe.

Section 6.  Secretary.  The Secretary shall attend all meetings of the Board of Directors and all meetings of the shareholders and record all votes and the minutes of all proceedings of the same.  He or she shall give notice of all meetings of shareholders and special meetings of the Board of Directors and, when appropriate, shall cause the corporate seal to be affixed to any instrument executed on behalf of the Company.  The Secretary shall also superintend the keeping and have charge of the books, records and papers of the Company.  Except when a Transfer Agent and Registrar for the stock of the Company is employed, the Secretary shall keep a register of the address of each shareholder, and make all proper changes in such register, retaining and filing his or her authority for all such entries.  The Secretary shall perform such other duties as may be prescribed by the Chief Executive Officer, President or the Board of Directors from time to time, or as may be incident to his or her office.  The Assistant Secretaries, if any, shall, during the absence of the Secretary, perform the duties and functions and exercise the powers of the Secretary.  Each Assistant Secretary shall perform such other duties as the Chief Executive Officer, President, or Chairman of the Board of Directors shall, from time to time, assign.

ARTICLE IX

STOCK

Section 1.  Certificates of Stock.  Shares of stock of the Company may be uncertificated or represented by certificates.  Owners of shares of the stock of the Company shall be recorded in the share register of the Company; and ownership of such shares shall be evidenced by a certificate or book-entry notation in the share register of the Company.  Any certificates representing such shares shall be signed by, or in the name of the Company by, the President or a Vice President and also by the Secretary or an Assistant Secretary or with facsimile signatures of the foregoing officers.  In case any officer who has signed, or whose facsimile signature has been placed upon, a certificate shall cease to be such officer before such certificate is issued, the certificate may be issued by the Company with the same effect as if he or she were such officer at the date of issue.

Section 2.  Transfers.  Transfers of stock represented by a certificate may be made on the books of the Company only by the person(s) named in the certificate(s) or by the attorney lawfully constituted in writing representing such named person(s), and upon surrender of the certificate representing the same, properly endorsed.  Uncertificated shares shall be transferred on the books of the Company upon the written instruction from the registered owner of such uncertificated shares, or from a duly authorized attorney or from an individual presenting proper evidence of succession, assignment or authority to transfer the stock.

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Section 3.  Record Date.  The Board of Directors may close the transfer books in its discretion for a period not exceeding 70 days preceding the day appointed for any meeting, annual or special, of the shareholders, or the payment of a dividend or the allotment of rights, or in its discretion the Board of Directors may fix a date not exceeding 70 days preceding any such appointed day as a record date for the determination of shareholders entitled to notice of, and to vote at, such meeting or to receive such dividend or rights, as the case may be.

Section 4.  Determination of Holders.  The Company shall be entitled to treat the holder of record of any share(s) of stock as the holder in fact thereof and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as expressly provided by the laws of the State of Missouri.

Section 5.  Transfer Agent and Registrar.  The Board of Directors may appoint one or more Transfer Agents and Registrars for its stock, and may require all stock certificates to bear the signature either of a Transfer Agent or of a Registrar, or both.

Section 6.  Lost or Destroyed Certificates.  Any person claiming a certificate of stock to be lost or destroyed shall make an affidavit or affirmation of that fact and advertise the same in such manner as the Board of Directors may require, and shall give the Company, its Transfer Agents and Registrars, if they shall so require, a bond of indemnity, in form and with one or more sureties satisfactory to the Board, the Transfer Agents and the Registrars of the Company, in the form and with such provisions as the Transfer Agent or Registrar may deem reasonably satisfactory, whereupon a new certificate may be issued of the same tenor and for the same number of shares as the one alleged to be lost or destroyed.

ARTICLE X

MISCELLANEOUS

Section 1.  Dividends.  Subject to law and the provisions of the Charter, the Board of Directors shall have absolute discretion in the declaration of dividends and in fixing and changing the date for the declaration and payment of dividends.  Before payment of any dividend or making any distribution of profits, the Board of Directors may set aside, out of the surplus or net profits of the Company, such sum or sums as the Board of Directors may from time to time in its absolute discretion deem proper as a reserve fund for depreciation or working capital, or for any other purpose which the Board of Directors shall deem conducive to the interests of the Company.

Section 2.  Books and Records.  When entitled to do so under applicable law, shareholders may inspect the books of the Company at the office of the Company during the usual business hours of the Company and in the presence of a representative of the Company, and under such other reasonable regulations as the officers of the Company may prescribe in the particular instance.

Section 3.  Checks, Drafts, Evidence of Indebtedness.  All checks, bills, notes, drafts, vouchers, and other evidences of indebtedness of the Company shall be signed for the Company by the Chief Executive Officer, the President, or Treasurer and may also be signed and countersigned by such person(s) as the Chief Executive Officer or President  may designate, provided that instruments requiring execution with the formality of deeds shall be signed by the Chief Executive Officer, the President, Treasurer or a Vice President and impressed with the seal of the Company, duly attested by the Secretary or an Assistant Secretary.

Section 4.  Contracts.  All contracts, deeds, mortgages, leases or instruments that require the seal of the Company to be affixed thereto shall be signed by the Chief Executive Officer, the President or a Vice President, and by the Secretary or an Assistant Secretary, or by such other officer(s) or person(s) as the Board of Directors or Executive Committee may by resolution prescribe.

Section 5.  Fiscal Year.  The fiscal year of the Company shall begin on the first day of October and end on the thirtieth day of September of each year.

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Section 6.  Amendments.  As provided by the Charter, the power to make, alter, amend or repeal these Bylaws is vested in the Board of Directors.  Such power may be exercised by the vote of a majority of all of the directors at any annual or regular meeting or at a duly called special meeting.

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EX-10.1

Exhibit 10.1

The Laclede Group

2006 Equity Incentive Plan

     Section 1. PURPOSE

     The purpose of this Plan is to promote the interests of The Laclede Group, Inc. (the “Company”) by granting Awards to the directors, officers and employees of the Company and its Subsidiaries in order to (a) attract and retain directors, officers and employees of outstanding ability; (b) provide an additional incentive to selected individuals to work to increase the value of the Stock; and (c) provide each such individual with a stake in the future of the Company which corresponds to the stake of each of the Company’s shareholders.

     Section 2. DEFINITIONS

     Each term set forth in this Section 2 shall have the meaning set forth opposite such term for purposes of this Plan and for any Award granted under this Plan. For purposes of such definitions, the singular shall include the plural and the plural shall include the singular. Unless otherwise expressly indicated, all Section references herein shall be construed to mean references to a particular Section of this Plan.

     2.1 Award means an award determined in accordance with the terms of the Plan.

     2.2 Board means the Company’s Board of Directors.

     2.3 Cause means with respect to the termination of a Participant’s Continuous Service with the Company or any of its Subsidiaries:

     (i) Willful and continued failure by the Participant to perform substantially the duties of employment assigned by the Company (other than any such failure resulting from incapacity due to physical or mental illness) after a demand for substantial performance has been delivered by the Company, which specifically identifies the manner in which it is believed that the Participant has not substantially performed such duties; or

     (ii) Willful engagement by the Participant in misconduct that is materially injurious to the Company.

For purposes of this definition, no act, or failure to act, on the Participant’s part shall be considered willful unless done, or omitted to be done, by the Participant in bad faith or without reasonable belief that the Participant’s action or omission was in the best interest of the Company and its Subsidiaries. Any act or failure to act based upon authority given pursuant to a resolution duly adopted by the Board or, with respect to a Participant other than the Chief Executive Officer, upon the instructions of the Chief Executive Officer or a senior officer of the Company or based upon the advice of counsel for the Company which advice was authorized by the Board or the Chief Executive Officer, shall be conclusively presumed to be done, or omitted to be done, by the Participant in good faith and in the best interests of the Company and its subsidiaries.

     2.4 Change in Control means the occurrence of one of the following events:

(i) The purchase or other acquisition (other than from the Company) by any person, entity or group of persons, within the meaning of Sections 13(d) or 14(d) of the Exchange Act (excluding, for this purpose, the Company or its Subsidiaries or any employee benefit plan of the Company or its Subsidiaries), of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or

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more of either the Company’s then outstanding shares of Common Stock or the combined voting power of the Company’s then outstanding voting securities entitled to vote generally in the election of directors; or

     (ii) Individual members of the Board of Directors, as of the Effective Date (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Effective Date whose election, or nomination for election by the Company’s shareholders, was approved by the vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, as a member of the Incumbent Board, any such individual whose initial election to office occurs as a result of either an actual or threatened election contest (as such term is used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a party other than the Board of Directors of the Company; or

     (iii) Consummation by the Company of a reorganization, merger or consolidation, in each case, with respect to which persons who were the shareholders of the Company immediately prior to such reorganization, merger or consolidation do not, immediately thereafter, own more than 50% of the surviving entity’s then outstanding shares of common stock or the surviving entity’s combined voting power entitled to vote generally in the election of directors, or of a liquidation or dissolution of the Company or of the sale of all or substantially all of the Company’s assets. In making this computation as to any Company shareholder who was also an equity owner in any other party to such reorganization, merger, or consolidation prior to consummating such transaction, only the common stock or voting power relating to such shareholder’s equity interests in the Company shall be counted toward the 50% threshold in the prior sentence.

Notwithstanding the foregoing, a Change in Control of the Company shall not be deemed to occur solely because any person acquires beneficial ownership of more than 20% of the Company Voting Securities as a result of the acquisition of Company Voting Securities by the Company which reduces the number of Company Voting Securities outstanding; provided, that, if after such acquisition by the Company such person takes further action to increase the percentage of outstanding Company Voting Securities beneficially owned by such person, a Change in Control of the Company shall then occur.

Notwithstanding the foregoing, to the extent that any Award granted under the Plan is subject to the provisions of Section 409A of the Code, the definition of Change of Control shall mean a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company within the meaning of Section 409A of the Code to the extent such Award constitutes nonqualified deferred compensation within the meaning of Section 409A of the Code.

     2.5 Code means the Internal Revenue Code of 1986, as amended from time to time, including regulations thereunder and successor provisions thereto.

     2.6 Committee means the Compensation Committee composed of at least three members of the Board who qualify as “outside directors” within the meaning of Section 162(m) of the Code, as “independent” directors under the listing standards of the New York Stock Exchange, and as “non-employee directors” under Rule 16b-3 as promulgated under Section 16 of the Exchange Act.

     2.7 Company means The Laclede Group, Inc., and any entity that succeeds to all or substantially all of its business.

2.8 Continuous Service means the Participant’s service as an officer or employee with the Company or a Subsidiary that is not terminated. The Participant’s Continuous Service shall not be deemed to have terminated merely because of a change in the capacity in which the Participant renders service to the Company or a Subsidiary as an officer or employee or a change in the entity for which the Participant renders such service.

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     2.9 Covered Employee has the meaning set forth in Section 162(m)(3) of the Code.

     2.10 Exchange Act means the Securities Exchange Act of 1934, as amended.

     2.11 Fair Market Value means the closing quoted selling price for such Common Stock on the relevant date, as reported on the New York Stock Exchange. If the New York Stock Exchange is not open for trading on that date, Fair Market Value of one share of Common Stock shall be the average of the closing prices on the nearest trading date before and the nearest trading date after that date.

     2.12 GAAP means U.S. Generally Accepted Accounting Principles.

     2.13 Immediate Family Member means, except as otherwise determined by the Committee, a Participant’s spouse, ancestors and descendants.

     2.14 Incentive Stock Option means a stock option that is intended to meet the requirements of Section 422 of the Code.

     2.15 Nonqualified Stock Option means any stock option granted under this Plan to purchase stock that is not intended to be an Incentive Stock Option.

     2.16 Option means either an Incentive Stock Option or a Nonqualified Stock Option.

     2.17 Option Price means the price that shall be paid to purchase one share of Stock upon the exercise of an Option granted under this Plan.

     2.18 Parent Corporation means any corporation that is a parent corporation of the Company within the meaning of Section 424(e) of the Code.

     2.19 Participant means anyone who is selected to participate in the Plan in accordance with Section 6.

2.20 Performance Goals means or may be expressed in terms of any of the following business criteria: revenue; earnings before interest, taxes, depreciation and amortization (“EBITDA”); earnings before interest and taxes (“EBIT”); funds from operations; funds from operations per share; operating income (loss); pre or after tax income (loss); cash available for distribution; cash available for distribution per share; cash and/or cash equivalents available for operations; net earnings (loss); earnings (loss) per share; return on equity; return on assets; return on capital; share price performance; total shareholder return; economic value added; economic profit; credit rating; improvements in the Company’s attainment of expense levels; objective third-party measures of customer satisfaction; objective measures of operating stability and reliability; operating goals related to customer satisfaction improvement; implementing or completion of critical projects, including, without limitation, implementation of strategic plan(s), improvement in investor relations, marketing and manufacturing of key products, improvement in cash-flow (before or after tax), development of critical projects or product development, progress relating to research and development, or other business criteria as determined by the Committee. A Performance Goal may be measured over a Performance Period on a periodic, annual, cumulative or average basis and may be established on a corporate-wide basis or established with respect to one or more operating units, divisions, subsidiaries, acquired businesses, minority investments, partnerships or joint ventures. The Performance Goals will be determined by the Committee by no later than the earlier of the date that is ninety days after the commencement of the Performance Period or the day prior to the date on which twenty-five percent of the Performance Period has elapsed.

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     2.21 Performance Objective means the level or levels of performance required to be attained with respect to specified Performance Goals in order that a Participant shall become entitled to specified rights in connection with an Award of performance shares.

     2.22 Performance Period means the fiscal year, or such other shorter or longer period designated by the Committee, during which performance will be measured in order to determine a Participant’s entitlement to receive payment of an Award.

     2.23 Performance Awards means a performance grant issued pursuant to Section 11 of the Plan.

     2.24 Plan means The Laclede Group 2006 Equity Incentive Plan, as amended from time to time.

     2.25 Restricted Stock means an award granted pursuant to Section 10 of the Plan.

     2.26 Securities Act means the Securities Act of 1933, as amended.

     2.27 SEC means the Securities Exchange Commission.

     2.28 Stock or Common Stock means the Company’s common stock, $1.00 par value per share.

     2.29 Stock Appreciation Right means an award granted pursuant to Section 12 of the Plan.

     2.30 Subsidiary means any affiliate of the Company selected by the Board; provided, that, with respect to any “stock right” within the meaning of Section 409A of the Code, such affiliate must qualify as a “service recipient” within the meaning of Section 409A of the Code and in applying Section 1563(a)(1), (2) and (3) of the Code for purposes of determining a controlled group of corporations under Section 414(b) of the Code and in applying Treasury Regulation Section 1.414(c)-2 for purposes of determining trades or businesses (whether or not incorporated) that are under common control for purposes of Section 414(c) of the Code, the language “at least 50 percent” is used instead of “at least 80 percent”; provided, that, with respect to Incentive Stock Options, it shall mean any subsidiary of the Company that is a corporation and that at the time qualifies as a “subsidiary corporation” within the meaning of Section 424(f) of the Code.

     Section 3. SHARES SUBJECT TO AWARDS

3.1 Subject to adjustment in accordance with Section 13, the total number of shares of Stock that shall be available for the grant of Awards under the Plan shall not exceed one million two hundred fifty thousand (1,250,000) shares of Stock; provided, that, for purposes of this limitation, (i) any Stock subject to an Option or Award that is canceled, forfeited or expires prior to exercise or realization; (ii) any Stock representing such portion of an Award settled in cash (in whole or in part) or otherwise not resulting in the issuance of all or a portion of the Stock subject to the Award; and (iii) any Stock tendered (either actually or by attestation) or withheld by the Company (a) for the exercise of any Option or other Award granted under this Plan or (b) for tax liabilities arising from such Option or other Award; shall again become available for issuance under the Plan. Subject to adjustment in accordance with Section 13, no employee shall be granted, during any one (1) year period, Options to purchase or any other Awards with respect to more than one hundred twenty-five thousand (125,000) shares of Stock. Stock available for distribution under the Plan shall be authorized and unissued shares, treasury shares or shares reacquired by the Company in any manner. Notwithstanding anything to the contrary contained herein: (i) shares of Stock that are repurchased by the Company with Option proceeds shall not be added to the aggregate plan limit described above; and (ii) all shares of Stock covered by a Stock Appreciation Right, to the extent that it is exercised and settled in shares of Stock, and whether or not shares of Stock are actually issued to the Participant upon exercise of the right, shall be considered issued or transferred pursuant to the Plan.

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     3.2Incentive Stock Options. Notwithstanding Section 3.1, subject to adjustment in accordance with Section 13, the aggregate number of shares of Stock with respect to which Incentive Stock Options may be granted under the Plan shall not exceed one million two hundred fifty thousand (1,250,000) shares of Stock.

     Section 4. EFFECTIVE DATE; APPROVAL OF SHAREHOLDERS

     The Plan is effective as of the date it is approved by the affirmative vote of the holders of a majority of the securities of the Company present, or represented, and entitled to vote at a meeting of shareholders duly held in accordance with the applicable laws of the State of Missouri (the “Effective Date”). Unless the Company determines to submit Section 11 of the Plan and the definition of Performance Goal to the Company’s shareholders at the first shareholder meeting that occurs in the fifth year following the year in which the Plan was last approved by shareholders (or any earlier meeting designated by the Board), in accordance with the requirements of Section 162(m) of the Code, and such shareholder approval is obtained, then no further Performance Awards shall be made to Covered Employees under Section 11 after the date of such annual meeting, but the Plan may continue in effect for Awards to employees not in accordance with Section 162(m) of the Code.

     Section 5. ADMINISTRATION

     5.1Administration by Committee. Subject to the further provisions of this Section 5, this Plan shall be administered by the Committee.

     5.2Powers of Committee. The Committee shall (i) approve the selection of Participants, (ii) determine the type of Awards to be made to Participants, (iii) determine the number of shares of Stock subject to Awards, (iv) determine the terms and conditions of any Award granted hereunder (including, but not limited to, any restriction and forfeiture conditions on such Award) and (v) have the authority to interpret the Plan, to establish, amend, and rescind any rules and regulations relating to the Plan, to determine the terms and provisions of any agreements entered into hereunder, and to make all other determinations necessary or advisable for the administration of the Plan. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any Award in the manner and to the extent it shall deem desirable to carry it into effect.

     5.3Committee Action Binding. Any action of the Committee shall be final, conclusive and binding on all persons, including the Company and its Subsidiaries and shareholders, Participants and persons claiming rights from or through a Participant.

     5.4Delegation. The Committee may delegate to officers or employees of the Company or any Subsidiary, and to service providers, the authority, subject to such terms as the Committee shall determine, to perform administrative functions with respect to the Plan and Award agreements.

     5.5Indemnification. Members of the Committee and any officer or employee of the Company or any Subsidiary acting at the direction of, or on behalf of, the Committee shall not be personally liable for any action or determination taken or made in good faith with respect to the Plan, and shall, to the extent permitted by law, be fully indemnified by the Company with respect to any such action or determination.

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     Section 6. ELIGIBILITY

     Individuals eligible to receive Awards under the Plan shall be the directors, officers and employees of the Company and its Subsidiaries selected by the Committee. Designation of a Participant in any year shall not require the Committee to designate such person as a Participant in any other year or to receive the same type or amount of award as granted in any other year.

     Section 7. AWARDS

     Awards under the Plan may consist of Options, Restricted Stock, Stock Appreciation Rights and Performance Awards. Awards shall be subject to the terms and conditions of the Plan and shall be evidenced by an agreement containing such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall deem desirable.

     Section 8. VESTING

     The Committee shall determine the time or times at which an Award will vest or become exercisable and the terms on which an Award requiring exercise will become and remain exercisable, provided that, except in the case of Awards made in connection with the recruitment of new employees (including new officers) or as otherwise provided in this Plan, (i) Options and Stock Appreciation Rights shall vest in equal annual installments over a period of not less than three years and (ii) Restricted Stock and Performance Awards shall have a vesting period of  not less than three years from the grant date (but permitting pro rata vesting over such time) of the Award.  Notwithstanding the foregoing, the restrictions in the preceding sentence shall not be applicable to grants of up to 5% of the number of Shares available for Awards under Section 3.   Subject to the foregoing minimum vesting period restrictions, the Committee may at any time accelerate the vesting or exercisability of an Award, regardless of any adverse or potentially adverse tax consequences resulting from such acceleration. The Committee may also at any time accelerate the vesting or exercisability of an Award, without being subject to the limitations set forth in the first sentence of this Section 8, if such acceleration is associated with the death, disability, retirement or other termination of employment or service of a Participant. For purposes of the foregoing sentence, the Committee will have sole and conclusive power to define the types of disability, retirement or other termination of employment or service associated with such acceleration.

     Section 9. OPTIONS

     9.1 Grant of Options. The Committee may grant Options to eligible individuals under this Plan to purchase shares of Stock. Each grant of an Option shall be evidenced by an Award agreement, and each Award agreement shall state whether or not the Option will be treated as an Incentive Stock Option or Nonqualified Stock Option and shall incorporate such terms and conditions as the Committee in its discretion deems appropriate and consistent with the terms of this Plan. The aggregate Fair Market Value of the Stock for which Incentive Stock Options granted to any one employee under this Plan or any other incentive stock option plan of the Company or of any of its Subsidiaries may by their terms first become exercisable during any calendar year shall not exceed $100,000, determining Fair Market Value as of the date each respective Option is granted. In the event such threshold is exceeded in any calendar year, such excess Options shall be automatically deemed to be Nonqualified Stock Options. To the extent that any Option granted under this Plan that is intended to be an Incentive Stock Option fails for any reason to qualify as such at any time, such Option shall be a Nonqualified Stock Option.

9.2 Option Price. The Option Price for each share of Stock subject to an Option shall be determined by the Committee and shall not be less than the Fair Market Value of a share of Stock on the date the Option is granted; provided, however, in the case of Incentive Stock Options granted to an employee owning stock

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possessing more than 10% of the total combined voting power of all classes of shares of the Company and its Subsidiaries (a “10% shareholder”) the price per share specified in the Award agreement shall not be less than 110% of the Fair Market Value per share of Stock on the date of grant.

     9.3 Option Period. The term of each Option shall be fixed by the Committee, but no Option shall be exercisable after the expiration of ten (10) years from the date the Option is granted; provided, that, in the case of Incentive Stock Options granted to 10% Shareholders, the term of such Option shall not exceed five (5) years from the date of grant.

     9.4 Method of Exercise. Options may be exercised, in whole or in part, by giving written notice of exercise to the Company in a form approved by the Company specifying the number shares of Stock to be purchased. Such notice shall be accompanied by the payment in full of the Option Price multiplied by the number of Options. The Option Price may be paid by (i) cash or certified or bank check, (ii) surrender of Stock held by the optionee for at least six (6) months prior to exercise (or such longer or shorter period as may be required to avoid a charge to earnings for financial accounting purposes) or the attestation of ownership of such shares, in either case, if so permitted by the Company, (iii) through a “same day sale” commitment from the optionee and a broker-dealer selected by the Participant that is a member of the National Association of Securities Dealers (an “NASD Dealer”) whereby the optionee irrevocably elects to exercise the Option and to sell a portion of the shares so purchased sufficient to pay for the total Option Price and whereby the NASD Dealer irrevocably commits upon receipt of such shares to forward the total Option Price directly to the Company, (iv) through additional methods prescribed by the Committee, or (v) by any combination of the foregoing, and, in all instances, to the extent permitted by applicable law. Options may not be exercised for fractional shares of Stock. A Participant’s subsequent transfer or disposition of any Stock acquired upon exercise of an Option shall be subject to any Federal and state laws then applicable, specifically securities law, and the terms and conditions of this Plan.

     9.5 Prohibition on Repricing. Without shareholder approval, no Option granted hereunder shall be amended to reduce the Option Price under such Option, surrendered in exchange for a replacement Option having a lower purchase price per share, or surrendered in exchange for cash or another Award; provided, that, this Section 9.5 shall not restrict or prohibit any adjustment or other action taken pursuant to Section 13 below.

     Section 10. RESTRICTED STOCK

The Committee, acting in its absolute discretion, may award Restricted Stock under the Plan to eligible Participants. Shares of Restricted Stock may not be sold, assigned, transferred or otherwise disposed of, or pledged or hypothecated as collateral for a loan or as security for the performance of any obligation or for any other purpose, for such period (the “Restricted Period”) as the Committee shall determine. The Committee may define the Restricted Period in terms of the passage of time or in any other manner it deems appropriate, including, without limitation, based on the achievement of Performance Goals. Subject to the vesting requirements of Section 8, the Committee may alter or waive at any time any term or condition of Restricted Stock that is not mandatory under the Plan. Except as restricted under the terms of the Plan and any Award agreement, any Participant awarded Restricted Stock shall have all the rights of a shareholder including, without limitation, the right to vote Restricted Stock and the right to all dividends paid relative to the Restricted Stock during the Restricted Period. If a share certificate is issued in respect of Restricted Stock, the certificate shall be registered in the name of the Participant, but shall be held by the Company for the account of the Participant until the end of the Restricted Period. The Committee may also award Restricted Stock in the form of Restricted Stock units having a value equal to an identical number of shares of Stock. Payment of Restricted Stock units shall be made in Stock or in cash or in a combination thereof (based upon the Fair Market Value of the Stock on the day the Restricted Period expires), all as determined by the Committee in its sole discretion. Notwithstanding the provisions of this Section, cash dividends, stock and any other property (other than cash) distributed as a dividend or otherwise with respect to any award of Restricted Stock or Restricted Stock units that vests based on achievement of performance goals shall either (i) not be paid or credited or (ii) be accumulated and subject to restrictions and risk of

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forfeiture to the same extent as the Restricted Stock or Restricted Stock units with respect to which such cash, stock or other property has been distributed.

     Section 11. PERFORMANCE AWARDS

     11.1 Performance Awards. Performance awards may be granted in the form of actual shares of Stock or Stock units having a value equal to an identical number of shares of Stock. In the event that a share certificate is issued in respect of Performance Shares, such certificate shall be registered in the name of the Participant, but shall be held by the Company until the end of the Performance Period. The Committee shall determine in its sole discretion whether Performance Shares granted in the form of Stock units shall be paid in cash, Stock, or a combination of cash and Stock. In addition, the Committee may make cash bonuses to Participants based on the Performance Objectives described herein (performance shares and performance cash bonuses to be collectively referred to as “Performance Awards”). The Performance Objectives and Performance Period for any Performance Awards shall be determined by the Committee in its sole discretion.

     11.2 Performance Objectives. The Committee shall establish the Performance Objectives for each Performance Award, consisting of one or more business criteria permitted as Performance Goals hereunder, one or more levels of performance with respect to each such criteria, and the amount or amounts payable or other rights that the Participant will be entitled to upon achievement of such levels of performance. The Performance Objectives shall be established by the Committee prior to, or reasonably promptly following the inception of, a Performance Period but, to the extent required by Section 162(m) of the Code, by no later than the earlier of the date that is ninety (90) days after the commencement of the Performance Period or the day prior to the date on which twenty-five percent of the Performance Period has elapsed.

     11.3 Additional Provisions Applicable to Performance Awards. More than one Performance Objective may be incorporated in a Performance Goal, and the level of achievement with respect to each Performance Objective may be assessed individually or in combination with each other. The level or levels of performance specified with respect to a Performance Objective may be established in absolute terms, as objectives relative to performance in prior periods, as an objective compared to the performance of one or more comparable companies or an index covering multiple companies, or otherwise as the Committee may determine. Performance Objectives shall be objective and shall otherwise meet the requirements of Section 162(m) of the Code. Performance Objectives may differ for Performance Awards granted to any one Participant or to different Participants. A Performance Award to a Participant who is a Covered Employee shall (unless the Committee determines otherwise as provided in Section 8 of this Plan) provide that in the event of the Participant’s termination of Continuous Service prior to the end of the Performance Period for any reason, such Performance Award will be payable only (i) if the applicable Performance Objectives are achieved and (ii) to the extent, if any, as the Committee shall determine.

     11.4 Duration of Performance Period. The Committee shall establish each Performance Period at the time that it sets the Performance Objectives applicable to that Performance Period. The Committee shall be authorized to permit overlapping or consecutive Performance Periods.

11.5 Certification. Following the completion of each Performance Period, the Committee shall certify in writing, in accordance with the requirements of Section 162(m) of the Code, whether the Performance Objectives and other material terms of the Performance Award have been achieved or met. Unless the Committee determines otherwise, Performance Awards shall not be settled until the Committee has made the certification specified under this Section 11.5.

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      11.6 Adjustment. To the extent necessary to preserve the intended economic effects of the Plan to the Company and the Participants, the Committee shall adjust Performance Objectives, the Performance Awards or both to take into account: (i) a change in corporate capitalization, (ii) a corporate transaction, such as any acquisition, any merger of the Company or any subsidiary into another corporation, any consolidation of the Company or any subsidiary into another corporation, any separation of the Company or any subsidiary (including a spinoff or the distribution of stock or property of the Company or any subsidiary), any reorganization of the Company or any subsidiary or a large, special and non-recurring dividend paid or distributed by the Company (whether or not such reorganization comes within the definition of Section 368 of the Code), (iii) any partial or complete liquidation of the Company or any subsidiary, (iv) any action by a regulatory agency, (v) a change in accounting, tax or other relevant rules or regulations, (vi) restructured or discontinued operations, (vii) restatement of prior period financial results, or (viii) other extraordinary and non-recurring items separately identified and quantified in the Company’s financial statements; provided, however, that no adjustment hereunder shall be authorized or made if and to the extent that the Committee determines that such authority or the making of such adjustment would cause the Performance Award to fail to qualify as “qualified performance-based compensation” under Section 162(m) of the Code.

     11.7 Maximum Amount Payable. Subject to Section 13, the maximum number of shares of Stock subject to a Performance Award granted to a Covered Employee is fifty thousand (50,000) shares of Stock during any one fiscal year (or, to the extent such Performance Award is paid in cash, the maximum dollar amount of any such Award is the equivalent cash value, based on the Fair Market Value of the Stock, of such number of shares of Stock on the last day of the Performance Period). If the Performance Award is a performance cash bonus, the maximum of cash bonuses payable in any one fiscal year to a Participant shall be $2,000,000.

     11.8 Dividend Equivalents. Amounts, if any, credited to Performance Awards equivalent to cash, stock or other property dividends shall be subject to restrictions and risk of forfeiture to the same extent as the Award with respect to which such cash, stock or other property has been distributed.

     Section 12. STOCK APPRECIATION RIGHTS

     12.1 Grant of Stock Appreciation Rights. The Committee may either alone or in connection with the grant of another Award, grant Stock Appreciation Rights in accordance with the Plan, the terms and conditions of which shall be set forth in an Award agreement. If granted in connection with an Option, a Stock Appreciation Right shall cover the same number of shares of Stock covered by the Option (or such lesser number of shares as the Committee may determine) and shall, except as provided in this Section 12, be subject to the same terms and conditions as the related Option.

     12.2 Time of Grant. A Stock Appreciation Right may be granted (i) at any time if unrelated to an Option, or (ii) if related to an Option, either at the time of grant, or in the case of Nonqualified Stock Options, at any time thereafter during the term of such Option.

     12.3 Stock Appreciation Right Related to an Option.

     (a) A Stock Appreciation Right granted in connection with an Option shall be exercisable at such time or times and only to the extent that the related Options are exercisable, and will not be transferable except to the extent the related Option may be transferable. A Stock Appreciation Right granted in connection with an Incentive Stock Option shall be exercisable only if the Fair Market Value of a share of Stock on the date of exercise exceeds the Option Price specified in the related Incentive Stock Option Award agreement.

(b) Upon the exercise of a Stock Appreciation Right related to an Option, the Participant shall be entitled to receive an amount determined by multiplying (i) the excess of the Fair Market Value of a share

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of Stock on the date preceding the date of exercise of such Stock Appreciation Right over the per share Option Price under the related Option, by (ii) the number of shares of Stock as to which such Stock Appreciation Right is being exercised. Notwithstanding the foregoing, the Committee may limit in any manner the amount payable with respect to any Stock Appreciation Right by including such a limit in the agreement evidencing the Stock Appreciation Right at the time it is granted.

     (c) Upon the exercise of a Stock Appreciation Right granted in connection with an Option, the Option shall be canceled to the extent of the number of shares as to which the Stock Appreciation Right is exercised, and upon the exercise of an Option granted in connection with a Stock Appreciation Right, the Stock Appreciation Right shall be canceled to the extent of the number of shares of Stock as to which the Option is exercised or surrendered.

     12.4 Stock Appreciation Right Unrelated to an Option. The Committee may grant to a Participant Stock Appreciation Rights unrelated to Options. Stock Appreciation Rights unrelated to Options shall contain such terms and conditions as to exercisability, vesting and duration as the Committee shall determine, but in no event shall they have a term of greater than ten (10) years or an exercise price less than the Fair Market Value of a share of Stock on the date the Stock Appreciation Right is granted. Upon exercise of a Stock Appreciation Right unrelated to an Option, the Participant shall be entitled to receive an amount determined by multiplying (i) the excess of the Fair Market Value of a share on the date preceding the date of exercise of such Stock Appreciation Right over the per share exercise price of the Stock Appreciation Right, by (ii) the number of shares of Stock as to which the Stock Appreciation Right is being exercised. Notwithstanding the foregoing, the Committee may limit in any manner the amount payable with respect to any Stock Appreciation Right by including such a limit in the Award agreement evidencing the Stock Appreciation Right at the time it is granted.

     12.5 Method of Exercise. Stock Appreciation Rights shall be exercised by a Participant only by a written notice delivered in person or by mail to the Company at the Company’s principal executive office, specifying the number of shares of Stock with respect to which the Stock Appreciation Right is being exercised.

     12.6 Form of Payment. Payment of the amount determined under this Section 12 may be made in the discretion of the Committee solely in whole shares of Stock in a number determined at their Fair Market Value on the date preceding the date of exercise of the Stock Appreciation Right, or solely in cash, or in a combination of cash and shares. If the Committee decides to make full payment in shares of Stock and the amount payable results in a fractional share, payment for the fractional share will be made in cash.

     12.7 Prohibition on Repricing. Without shareholder approval, no Stock Appreciation Right granted hereunder shall be amended to reduce the Stock Appreciation Right exercise price, surrendered in exchange for a replacement Stock Appreciation Right having a lower exercise price per share, or surrendered in exchange for cash or another Award; provided, that, this Section 9.5 shall not restrict or prohibit any adjustment or other action taken pursuant to Section 13 below.

     Section 13. ADJUSTMENT

13.1 Corporate Transaction or Event. In the event of any dividend (other than a regular cash dividend) or other distribution (whether in the form of cash, Stock, other securities, or other property), recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, acquisition, split-up, spinoff, combination, repurchase, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or exchange of Stock or other securities of the Company, issuance of warrants or other rights to purchase Stock or other securities of the Company, or other similar corporate transaction or event (an “Event”), and in the Committee’s opinion, such Event affects the Stock such that an adjustment is determined by the Committee to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to an Award, then the Committee shall, in such manner as it may deem

A-10

equitable, including, without limitation, adjust any or all of the following: (i) the number and kind of shares of Stock (or other securities or property) with respect to which Awards may be granted or awarded; (ii) the number and kind of shares of Stock (or other securities or property) subject to outstanding Awards; (iii) the grant or exercise price with respect to any Award. The Committee determination under this Section 13.1 shall be final, binding and conclusive; and (iv) the applicable limitations for grants to a Participant under Section 3.1 and Section 11.7. Any such adjustment made to an Incentive Stock Option shall be made in accordance with Section 424(a) of the Code and any adjustment to any other Award that is subject to Section 409A of the Code shall be made in accordance with Section 409A of the Code, unless otherwise determined by the Committee, in its sole discretion.

     13.2 Termination; Cash-Out. Upon the occurrence of an Event in which outstanding Awards are not to be assumed or otherwise continued following such an Event, the Committee may, in its discretion, terminate any outstanding Award without a Participant’s consent and (i) provide for either the purchase of any such Award for an amount of cash equal to the amount that could have been attained upon the exercise of such Award or realization of the Participant’s rights had such Award been currently exercisable or payable or fully vested (or without any payment if the Fair Market Value of one share of Stock on the date of the Event is less than the per share exercise price of a Stock Option or Stock Appreciation Right) or the replacement of such Award with other rights or property selected by the Committee in its sole discretion and/or (ii) provide that such Award shall be exercisable (whether or not vested) as to all shares covered thereby for at least ten (10) days prior to such Event.

     13.3 No Restrictions on Adjustments. The existence of the Plan, Award agreements and the Awards granted hereunder shall not affect or restrict in any way the right or power of the Company or the shareholders of the Company to make or authorize any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, any merger or consolidation of the Company, any issue of stock or of options, warrants or rights to purchase stock or of bonds, debentures, preferred or prior preference stocks whose rights are superior to or affect the Stock or the rights thereof or which are convertible into or exchangeable for Stock, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

     Section 14. AMENDMENT OR TERMINATION

     The Board may amend, suspend or terminate the Plan or any portion thereof at any time, provided, that, (a) no amendment shall be made without shareholder approval if such approval is necessary to comply with any applicable law, regulation or stock exchange rule and (b) except as provided in the Plan, including, without limitation, Section 13, no amendment shall be made that would adversely affect the rights of a Participant under an Award theretofore granted, without such Participant’s written consent.

     Section 15. SPECIAL PROVISIONS

15.1 Change of Control. Unless otherwise provided in an Award agreement, upon the effective date of a Change of Control in which outstanding Awards are not terminated in accordance with Section 13 of the Plan and are assumed or substituted for by the successor company (or in which the Company is the ultimate parent corporation and continues the Award), if a Participant’s employment with such successor company (or the Company) or a subsidiary thereof terminates within 24 months following such Change in Control (or such other period set forth in the Award agreement, including prior thereto if applicable) and under the circumstances specified in the Award agreement, all Options and Stock Appreciation Rights, granted under this Plan prior to such Change of Control, shall immediately become vested and exercisable to the full extent of the original grant and all restrictions or performance conditions, if any, on any other Awards shall automatically lapse. Unless otherwise provided in an Award agreement, upon the effective date of a Change of Control in which outstanding Awards are not terminated in accordance with Section 13 of the Plan and are not assumed or substituted for by the successor company (or in which the Company is the

A-11

ultimate parent corporation and does not continue the Award), all Options and Stock Appreciation Rights, granted under this Plan prior to such Change of Control, shall immediately become vested and exercisable to the full extent of the original grant and all restrictions or performance conditions, if any, on any other Awards shall automatically lapse.

     15.2Forfeiture. Notwithstanding anything in the Plan to the contrary and unless otherwise specifically provided in an Award agreement, in the event of a termination of a Participant for Cause, the Committee may cancel any outstanding Award granted to such Participant or former Participant, in whole or in part, whether or not vested. Such cancellation shall be effective as of the date specified by the Committee.

     Section 16. GENERAL PROVISIONS

     16.1 Representations. The Committee may require each Participant purchasing or acquiring shares pursuant to an Award under the Plan to represent to and agree with the Company in writing that such Participant is acquiring the shares for investment and without a view to distribution thereof.

     16.2 Restrictions. Any certificates for Stock delivered under the Plan pursuant to any Award shall be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the SEC, any stock exchange upon which the Stock is then listed, and any applicable Federal or state securities law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions. If the Committee determines that the issuance of Stock hereunder is not in compliance with, or subject to an exemption from, any applicable Federal or state securities laws, such shares shall not be issued until such time as the Committee determines that the issuance is permissible.

     16.3 Section 16. It is the intent of the Company that the Plan satisfy, and be interpreted in a manner that satisfies, the applicable requirements of Rule 16b-3 as promulgated under Section 16 of the Exchange Act so that Participants will be entitled to the benefit of Rule 16b-3, or any other rule promulgated under Section 16 of the Exchange Act, and will not be subject to short-swing liability under Section 16 of the Exchange Act. Accordingly, if the operation of any provision of the Plan would conflict with the intent expressed in this Section 16.3, such provision to the extent possible shall be interpreted and/or deemed amended so as to avoid such conflict.

     16.4 Section 162(m). To the extent the Committee issues any Award that is intended to be exempt from the application of Section 162(m) of the Code, the Committee may, without shareholder or grantee approval, amend the Plan or the relevant Award agreement retroactively or prospectively to the extent it determines necessary in order to comply with any subsequent clarification of Section 162(m) of the Code required to preserve the Company’s Federal income tax deduction for compensation paid pursuant to any such Award.

     16.5 No Rights as Shareholder. Except as otherwise provided by the Committee in the applicable grant or Award agreement, a Participant shall have no rights as a shareholder with respect to any shares of Stock subject to an Award until a certificate or certificates evidencing shares of Stock shall have been issued to the Participant and, subject to Section 13, no adjustment shall be made for dividends or distributions or other rights in respect of any share for which the record date is prior to the date on which Participant shall become the holder of record thereof.

     16.6 Gender. Where the context requires, words in any gender shall include any other gender.

16.7 Headings. Headings of Sections are inserted for convenience and reference; they do not constitute any part of this Plan.

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     16.8 Expiration of the Plan. Subject to earlier termination pursuant to Section 14, no Award may be granted following the ten (10) year anniversary of the Effective Date and, except with respect to outstanding Awards, this Plan shall terminate.

     16.9 No Right to Continuous Service. Nothing contained in the Plan or in any Award under the Plan shall confer upon any Participant any right with respect to the continuation of service with the Company or any of its Subsidiaries, or interfere in any way with the right of the Company or its Subsidiaries to terminate his or her Continuous Service at any time. Nothing contained in the Plan shall confer upon any Participant or other person any claim or right to any Award under the Plan.

     16.10 Withholding. Upon (a) disposition of shares of Stock acquired pursuant to the exercise of an Incentive Stock Option granted pursuant to the Plan within two (2) years of the grant of the Incentive Stock Option or within one (1) year after exercise of the Incentive Stock Option, or (b) exercise of a Nonqualified Stock Option (or an Incentive Stock Option treated as a Nonqualified Stock Option), or the vesting or payment of any other Award under the Plan, or (c) under any other circumstances determined by the Committee in its sole discretion, the Company shall have the right to require any Participant, and such Participant by accepting the Awards granted under the Plan agrees, to pay to the Company the amount of any taxes which the Company shall be required to withhold with respect thereto. In the event of clauses (a), (b) or (c), with the consent of the Committee, at its sole discretion, such Participant may elect to have the Company withhold shares of Stock having a Fair Market Value equal to the amount of the withholding tax obligation as determined by the Company and calculated based on the Fair Market Value of the Common Stock on the date preceding the date of such notice; provided, however, that no shares of Stock are withheld with a value exceeding the minimum amount of tax required to be withheld by law. Such shares so delivered to satisfy the minimum withholding obligation may be either shares withheld by the Company upon the exercise of the Option or other shares.  Unless otherwise required by applicable federal or state laws or regulations, the Company shall not withhold or otherwise pay on behalf of any director who is not also an employee of the Company or any of its Subsidiaries any federal, state, local or other taxes arising in connection with Awards under this Plan.  The payment of any such taxes shall be the sole responsibility of each non-employee director.

     16.11 Nontransferability, Beneficiaries. Unless otherwise determined by the Committee with respect to the transferability of Awards (other than Incentive Stock Options) by a Participant to his or her Immediate Family Members (or to trusts or partnerships or limited liability companies established for such family members), no Award shall be assignable or transferable by the Participant, otherwise than by will or the laws of descent and distribution or pursuant to a beneficiary designation, and Options shall be exercisable, during the Participant’s lifetime, only by the Participant (or by the Participant’s legal representatives in the event of the Participant’s incapacity). Each Participant may designate a beneficiary to exercise any Option held by the Participant at the time of the Participant’s death or to be assigned any other Award outstanding at the time of the Participant’s death. If no beneficiary has been named by a deceased Participant, any Award held by the Participant at the time of death shall be transferred as provided in his or her will or by the laws of descent and distribution. Except in the case of the holder’s incapacity, an Option may only be exercised by the holder thereof.

     16.12 Governing Law. The law of the State of Missouri shall apply to all Awards and interpretations under the Plan regardless of the effect of such state’s conflict of laws principles.

16.13 Unfunded Status. The Plan is intended to constitute an “unfunded” plan for incentive compensation and nothing contained in the Plan shall give any Participant any rights that are greater than those of a general unsecured creditor of the Company. To the extent applicable, this Plan is intended to comply with Section 409A of the Code and the Committee shall interpret and administer the Plan in accordance therewith. In addition, any provision in this Plan document that is determined to violate the requirements of Section 409A shall be void and without effect. In addition, any provision that is required to appear in this Plan document that is not expressly set forth shall be deemed to be set forth herein, and such Plan shall be administered in all respects as if such provisions were expressly set forth.

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     16.14 Recoupment. All Awards may be subject to the Company’s recoupment policy as in effect from time to time. By acceptance of any payment of any Award, each Participant expressly agrees to repay to the Company any amount that may be required to be repaid under the policy when applicable.

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EX-12

Exhibit 12

THE LACLEDE GROUP, INC. AND SUBSIDIARY COMPANIES

SCHEDULE OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

	Twelve Months Ended
	Mar. 31,		September 30,
(Thousands of Dollars)		2012		2011		2010		2009		2008		2007
Income from continuing      operations before interest
charges and income taxes	$	122,425	$	118,424	$	107,986	$	126,517	$	113,228	$	101,867
Add: One third of applicable
rentals charged to operating
expense (which approximates
the interest factor)		1,714		1,799		1,825		1,833		1,691		1,485
Total Earnings	$	124,139	$	120,223	$	109,811	$	128,350	$	114,919	$	103,352
Interest on long-term debt –
Laclede Gas	$	22,958	$	23,161	$	24,583	$	24,583	$	19,851	$	22,502
Other interest		2,076		2,256		2,269		5,163		9,626		11,432
Add: One third of applicable
rentals charged to operating
expense (which approximates
the interest factor)		1,714		1,799		1,825		1,833		1,691		1,485
Total Fixed Charges	$	26,748	$	27,216	$	28,677	$	31,579	$	31,168	$	35,419
Ratio of Earnings to Fixed
Charges		4.64		4.42		3.83		4.06		3.69		2.92

EX-31

Exhibit 31

CERTIFICATION

I, Suzanne Sitherwood, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of The Laclede Group, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
		a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
		b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
		c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
		d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
		a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
		b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	April 27, 2012	Signature:	/s/ Suzanne Sitherwood
			Suzanne Sitherwood
			President and Chief Executive Officer

CERTIFICATION

I, Mark D. Waltermire, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of The Laclede Group, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
		a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
		b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
		c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
		d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
		a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
		b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	April 27, 2012	Signature:	/s/ Mark D. Waltermire
			Mark D. Waltermire
			Chief Financial Officer

EX-32

Exhibit 32

Section 1350 Certification

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, I, Suzanne Sitherwood, President and Chief Executive Officer of The Laclede Group, Inc., hereby certify that
	(a)	To the best of my knowledge, the accompanying report on Form 10-Q for the quarter ended March 31, 2012 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and
	(b)	To the best of my knowledge, the information contained in the accompanying report on Form 10-Q for the quarter ended March 31, 2012 fairly presents, in all material respects, the financial condition and results of operations of The Laclede Group, Inc.

Date:	April 27, 2012	/s/ Suzanne Sitherwood
		Suzanne Sitherwood
		President and Chief Executive Officer

Section 1350 Certification

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, I, Mark D. Waltermire, Chief Financial Officer of The Laclede Group, Inc., hereby certify that
	(a)	To the best of my knowledge, the accompanying report on Form 10-Q for the quarter ended March 31, 2012 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and
	(b)	To the best of my knowledge, the information contained in the accompanying report on Form 10-Q for the quarter ended March 31, 2012 fairly presents, in all material respects, the financial condition and results of operations of The Laclede Group, Inc.

Date:	April 27, 2012	/s/ Mark D. Waltermire
		Mark D. Waltermire
		Chief Financial Officer

XML

INFORMATION BY OPERATING SEGMENT (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011	Sep. 30, 2011
INFORMATION BY OPERATING SEGMENT [Abstract]
Regulated Gas Distribution segment, population of service area (in millions)	2.2		2.2
Number of service area counties	ten		ten
Number of entity subsidiaries	five		five
Operating Segment Information [Abstract]
Total Operating Revenues	$ 358,175	$ 543,778	$ 769,088	$ 987,980
Depreciation & amortization	10,175	9,739	20,264	19,377
Interest income	316	267	664	715
Interest charges	6,279	6,289	12,593	12,975
Income tax expense	16,001	16,228	29,557	28,769
Net economic earnings	28,427	27,462	53,320	50,850
Total assets	1,758,131	1,734,417	1,758,131	1,734,417	1,783,082
Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income [Abstract]
Total Net Economic Earnings above	28,427	27,462	53,320	50,850
Unrealized gain (loss) on energy-related derivative contracts, net of tax	1,963	431	2,244	412
Add: Lower of cost or market inventory adjustments, net of tax	(562)	0	(562)	0
Realized loss on economic hedges prior to sale of the physical commodity, net of tax	(144)	0	(144)	0
Net Income	29,684	27,893	54,858	51,262
Regulated Gas Distribution [Member]
Operating Segment Information [Abstract]
Revenues from external customers	298,623	387,737	549,522	664,242
Intersegment revenues	0	638	3	1,576
Total Operating Revenues	298,623	388,375	549,525	665,818
Net economic earnings	25,772	26,203	46,851	47,637
Total assets	1,680,948	1,634,674	1,680,948	1,634,674
Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income [Abstract]
Total Net Economic Earnings above	25,772	26,203	46,851	47,637
Non-Regulated Gas Marketing [Member]
Operating Segment Information [Abstract]
Revenues from external customers	66,045	151,305	218,022	309,006
Intersegment revenues	1,927	3,806	8,538	12,513
Total Operating Revenues	67,972	155,111	226,560	321,519
Net economic earnings	2,545	1,335	5,984	3,281
Total assets	177,129	165,403	177,129	165,403
Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income [Abstract]
Total Net Economic Earnings above	2,545	1,335	5,984	3,281
Other [Member]
Operating Segment Information [Abstract]
Revenues from external customers	381	33	1,544	124
Intersegment revenues	259	259	519	519
Total Operating Revenues	640	292	2,063	643
Net economic earnings	110	(76)	485	(68)
Total assets	151,646	130,172	151,646	130,172
Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income [Abstract]
Total Net Economic Earnings above	110	(76)	485	(68)
Unallocated and Eliminations [Member]
Operating Segment Information [Abstract]
Revenues from external customers	0	0	0	0
Intersegment revenues	(9,060)	0	(9,060)	0
Total Operating Revenues	(9,060)	0	(9,060)	0
Net economic earnings	0	0	0	0
Total assets	(251,592)	(195,832)	(251,592)	(195,832)
Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income [Abstract]
Total Net Economic Earnings above	$ 0	$ 0	$ 0	$ 0

XML

EARNINGS PER COMMON SHARE (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011
Basic EPS [Abstract]
Net Income	$ 29,684	$ 27,893	$ 54,858	$ 51,262
Less: Income allocated to participating securities	167	226	324	430
Net Income Available to Common Shareholders, Basic	29,517	27,667	54,534	50,832
Weighted Average Shares Outstanding, Basic (In Shares)	22,254,000	22,100,000	22,223,000	22,070,000
Earnings Per Share of Common Stock, Basic (Per Share)	$ 1.33	$ 1.25	$ 2.45	$ 2.30
Diluted EPS [Abstract]
Net Income (Loss)	29,684	27,893	54,858	51,262
Less: Income allocated to participating securities	166	226	323	429
Net Income Available to Common Stockholders, Diluted	$ 29,518	$ 27,667	$ 54,535	$ 50,833
Weighted Average Shares Outstanding, Basic (In Shares)	22,254,000	22,100,000	22,223,000	22,070,000
Dilutive Effect of Stock Options and Restricted Stock (In Shares)	82,000	72,000	76,000	75,000
Weighted Average Diluted Shares (In shares)	22,336,000	22,172,000	22,299,000	22,145,000
Earnings Per Share of Common Stock, Diluted (Per share)	$ 1.32	$ 1.25	$ 2.45	$ 2.30
Outstanding Shares Excluded from the Calculation of Diluted EPS Attributable to [Abstract]
Restricted stock and stock units subject to performance and/or market conditions	203,000	193,000	203,000	193,000

XML

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

6 Months Ended

Mar. 31, 2012

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES [Abstract]

Derivative Instruments and Hedging Activities

Open NYMEX/ICE natural gas futures and swap positions at March 31, 2012 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 2012	-	$	-	3.92	$	3.01
Fiscal 2013	-		-	6.78		3.29
Open long futures positions
Fiscal 2012	9.49	$	4.22	1.63	$	3.89
Fiscal 2013	21.86		4.16	1.43		3.90
Fiscal 2014	0.80		3.51	0.10		4.34

The Effect of Derivative Instruments on the Statements of Consolidated Income and Statements of Consolidated Comprehensive Income

The Effect of Derivative Instruments on the Statements of Consolidated Income and Statements of Consolidated Comprehensive Income
		Three Months Ended						Six Months Ended
	Location of Gain (Loss)	March 31,						March 31,
(Thousands)	Recorded in Income		2012			2011			2012			2011
Derivatives in Cash Flow Hedging Relationships
Effective portion of gain recognized in OCI on derivatives:
NYMEX/ICE natural gas contracts		$	5,023		$	693		$	8,020		$	734
NYMEX gasoline and heating oil contracts			83			267			133			440
Total		$	5,106		$	960		$	8,153		$	1,174
Effective portion of gain (loss) reclassified from AOCI to income:
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues	$	4,048		$	757		$	10,788		$	5,591
	Non-Regulated Gas Marketing Operating Expenses		(4,445	)		(682	)		(8,369	)		(2,475	)
Sub-total			(397	)		75			2,419			3,116
NYMEX gasoline and heating oil contracts	Regulated Gas Distribution Other Operation Expenses		(11	)		72			3			121
Total		$	(408	)	$	147		$	2,422		$	3,237
Ineffective portion of gain (loss) on derivatives recognized in income:
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues	$	50		$	551		$	69		$	560
	Non-Regulated Gas Marketing Operating Expenses		(90	)		(498	)		(196	)		(623	)
Sub-total			(40	)		53			(127	)		(63	)
NYMEX gasoline and heating oil contracts	Regulated Gas Distribution Other Operation Expenses		28			19			34			48
Total		$	(12	)	$	72		$	(93	)	$	(15	)
Derivatives Not Designated as Hedging Instruments *
Gain (loss) recognized in income on derivatives:
Natural gas commodity contracts	Non-Regulated Gas Marketing Operating Revenues	$	1,557		$	143		$	790		$	(299	)
	Non-Regulated Gas Marketing Operating Expenses		-			746			687			1,196
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues		1,478			(42	)		1,548			(78	)
	Non-Regulated Gas Marketing Operating Expenses		30			-			30			-
NYMEX gasoline and heating oil contracts	Other Income and (Income Deductions) - Net		12			47			13			63
Total		$	3,077		$	894		$	3,068		$	882

* 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 Utility Natural and Propane Gas operating expenses when they are recovered through the PGA Clause and reflected in customer billings.

Fair Value of Derivative Instruments in the Consolidated Balance Sheet

Fair Value of Derivative Instruments in the Consolidated Balance Sheet at March 31, 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	Derivative Instrument Assets	$	3,545		Derivative Instrument Assets	$	3,242
NYMEX gasoline and heating oil contracts	Accounts Receivable - Other		72		Accounts Receivable - Other		-
Sub-total			3,617				3,242
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Accounts Receivable - Other		709		Accounts Receivable - Other		36,437
	Derivative Instrument Assets		2,238		Derivative Instrument Assets		474
Natural gas commodity contracts	Derivative Instrument Assets		4,176		Derivative Instrument Assets		490
	Other Current Liabilities		48		Other Current Liabilities		721
	Other Deferred Charges		217		Other Deferred Charges		-
NYMEX gasoline and heating oil contracts	Accounts Receivable - Other		9		Accounts Receivable - Other		-
Sub-total			7,397				38,122
Total derivatives		$	11,014			$	41,364
Fair Value of Derivative Instruments in the Consolidated Balance Sheet at September 30, 2011
	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	$	4,395		Derivative Instrument Assets	$	4,105
	Other Deferred Charges		4		Other Deferred Charges		85
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		15		Derivative Instrument Assets		117
Sub-total			4,414				4,307
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Derivative Instrument Assets		457		Derivative Instrument Assets		16,330
	Other Deferred Charges		-		Other Deferred Charges		408
Natural gas commodity contracts	Derivative Instrument Assets		1,894		Derivative Instrument Assets		100
	Other Deferred Charges		183		Other Deferred Charges		-
	Other Current Liabilities		8		Other Current Liabilities		62
	Derivative Instrument Assets		4		Derivative Instrument Assets		7
Sub-total			2,546				16,907
Total derivatives		$	6,960			$	21,214

Fair Value of Derivative Instruments in the Consolidated Balance Sheet at March 31, 2011
	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	$	688		Derivative Instrument Assets	$	10,926
	Other Deferred Charges		11		Other Deferred Charges		61
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		341		Derivative Instrument Assets		-
Sub-total			1,040				10,987
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Derivative Instrument Assets		4,353		Derivative Instrument Assets		16,854
	Other Deferred Charges		666		Other Deferred Charges		-
Natural gas commodity contracts	Derivative Instrument Assets		957		Derivative Instrument Assets		121
	Other Current Liabilities		30		Other Current Liabilities		225
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		28		Derivative Instrument Assets		-
Sub-total			6,034				17,200
Total derivatives		$	7,074			$	28,187

* The fair values of Asset Derivatives and Liability Derivatives exclude the fair value of cash margin receivables or payables with counterparties subject to netting arrangements. Fair value amounts of derivative contracts (including the fair value amounts of cash margin receivables and payables) for which there is a legal right to set off are presented net on the Consolidated Balance Sheets. As such, the gross balances presented in the table above are not indicative of the Company's net economic exposure. Refer to Note 6, Fair Value Measurements, for information on the valuation of derivative instruments.

Derivative instrument Reconciliation

Following is a reconciliation of the amounts in the tables above to the amounts presented in the Consolidated Balance Sheets:

		March 31,			Sept. 30,			March 31,
	(Thousands)	2012			2011			2011
	Fair value of asset derivatives presented above	$	11,014		$	6,960		$	7,074
	Fair value of cash margin receivables offset with derivatives		35,648			23,188			32,258
	Netting of assets and liabilities with the same counterparty		(41,148	)		(21,160	)		(28,031	)
	Total	$	5,514		$	8,988		$	11,301
	Derivative Instrument Assets, per Consolidated Balance Sheets:
	Derivative instrument assets	$	5,297		$	7,759		$	10,491
	Other deferred charges		217			1,229			810
	Total	$	5,514		$	8,988		$	11,301
	Fair value of liability derivatives presented above	$	41,364		$	21,214		$	28,187
	Fair value of cash margin payables offset with derivatives		457			-			39
	Netting of assets and liabilities with the same counterparty		(41,148	)		(21,160	)		(28,031	)
	Derivative instrument liabilities, per Consolidated Balance Sheets*	$	673		$	54		$	195
*	Included in the Other line of the Current Liabilities section

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CONCENTRATIONS OF CREDIT RISK (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2012
Concentration Risk [Line Items]
Number of large counterparties for which credit risk is disclosed	five
Energy Producers And Their Affiliates [Member]
Concentration Risk [Line Items]
Accounts receivable	10.5
Net receivable amount	7.8
Utility Companies And Their Affiliates [Member]
Concentration Risk [Line Items]
Accounts receivable	12.6
Net receivable amount	11.9
Largest Counterparties [Member]
Concentration Risk [Line Items]
Accounts receivable	13.4
Net receivable amount	11.4

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STOCK-BASED COMPENSATION

6 Months Ended

Mar. 31, 2012

DisclosureOfCompensationRelatedCostsShareBasedPaymentsAbstract

STOCK-BASED COMPENSATION

3. STOCK-BASED COMPENSATION

Awards of stock-based compensation are made pursuant to The Laclede Group 2006 Equity Incentive Plan (2006 Plan) and the Restricted Stock Plan for Non-Employee Directors. Refer to Note 3 of the Consolidated Financial Statements included in the Company’s Form 10-K for the fiscal year ended September 30, 2011 for descriptions of these plans. In January 2012, shareholders approved certain amendments to the 2006 Plan, including an amendment allowing members of the Company’s Board of Directors to participate in the 2006 Plan. Accordingly, effective February 1, 2012, no additional awards will be granted under the Restricted Stock Plan for Non-Employee Directors, as any such awards will be made pursuant to the 2006 Plan.

Restricted Stock Awards

During the six months ended March 31, 2012, the Company granted 101,963 performance-contingent restricted share units to executive officers and key employees at a weighted average grant date fair value of $36.55 per share. This number represents the maximum shares that can be earned pursuant to the terms of the awards. The share units have a performance period ending September 30, 2014. While the participants have no interim voting rights on these share units, dividends accrue during the performance period and are paid to the participants upon vesting, but are subject to forfeiture if the underlying shares units do not vest. The number of share 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.

Activity of restricted stock and restricted stock units subject to performance and/or market conditions during the six months ended March 31, 2012 is presented below:

			Weighted
			Average
	Shares/		Grant Date
	Units		Fair Value
Nonvested at September 30, 2011	259,075			$	34.29
Granted (maximum shares that can be earned)	101,963			$	36.55
Vested	(48,429	)		$	48.70
Forfeited	(79,072	)		$	38.43
Nonvested at March 31, 2012	233,537			$	30.88

During the six months ended March 31, 2012, the Company granted 30,075 shares of time-vested restricted stock to executive officers and key employees at a weighted average grant date fair value of $39.72 per share. These shares were awarded on December 1, 2011 and vest December 1, 2014. In the interim, participants receive full voting rights and dividends, which are not subject to forfeiture.

In January 2012, the Company granted 13,700 shares of time-vested restricted stock to non-employee directors at a weighted average grant date fair value of $41.36 per share. These shares were granted under the Restricted Stock Plan for Non-Employee Directors and vest depending on the participant’s age upon entering the plan and years of service as a director. The plan’s trustee acquires the shares for the awards in the open market and holds the shares as trustee for the benefit of the non-employee directors until the restrictions expire. In the interim, the participants receive full dividends and voting rights. As discussed above, effective February 1, 2012, any awards to non-employee directors will be made pursuant to The Laclede Group 2006 Equity Incentive Plan.

Time-vested restricted stock and time-vested restricted stock unit activity for the six months ended March 31, 2012 is presented below:

			Weighted
			Average
	Shares/		Grant Date
	Units		Fair Value
Nonvested at September 30, 2011	143,350			$	37.00
Granted	43,775			$	40.23
Vested	(54,400	)		$	41.48
Forfeited	(12,700	)		$	33.53
Nonvested at March 31, 2012	120,025			$	36.51

During the six months ended March 31, 2012, 88,129 shares of restricted stock and stock units (performance-contingent and time-vested), awarded on February 14, 2008 and November 5, 2008, vested. The Company withheld 29,157 of the vested shares at a weighted average price of $39.96 per share pursuant to elections by employees to satisfy tax withholding obligations.

Stock Option Awards

Stock option activity for the six months ended March 31, 2012 is presented below:

					Weighted
					Average
			Weighted		Remaining	Aggregate
			Average		Contractual	Intrinsic
	Stock		Exercise		Term	Value
	Options		Price		(Years)	($000)
Outstanding at September 30, 2011	305,875		$	30.72
Granted	—		$	—
Exercised	(43,625	)	$	30.63
Forfeited	—		$	—
Expired	—		$	—
Outstanding at March 31, 2012	262,250		$	30.74	2.8	$	2,172
Fully Vested and Expected to Vest   at March 31, 2012	262,250		$	30.74	2.8	$	2,172
Exercisable at March 31, 2012	262,250		$	30.74	2.8	$	2,172

The closing price of the Company’s common stock was $39.02 at March 31, 2012.

Equity Compensation Costs

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

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Total equity compensation cost	$	684		$	822		$	1,351		$	1,540
Compensation cost capitalized		(221	)		(177	)		(359	)		(331	)
Compensation cost recognized in net income		463			645			992			1,209
Income tax benefit recognized in net income		(179	)		(248	)		(383	)		(466	)
Compensation cost recognized in net income,
net of income tax	$	284		$	397		$	609		$	743

As of March 31, 2012, there was $5.5 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 2.5 years.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Part 2 (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011
Off-System Sales [Line Items]
Gross Receipts taxes recorded in regulated gas distribution operating revenues	$ 15.5	$ 20.3	$ 25.7	$ 31.6

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Part 1 (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2012	Sep. 30, 2011	Mar. 31, 2011
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]
Accrued Unbilled Revenue	$ 13.0	$ 11.8	$ 29.0

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PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS Part 1 (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011
Pension Plans [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Service cost - benefits earned during the period	$ 2,301	$ 2,388	$ 4,613	$ 4,776
Interest Cost	4,840	4,705	9,711	9,410
Expected return on plan assets	(4,899)	(4,712)	(9,798)	(9,424)
Amortization of prior service cost (credit)	148	160	296	320
Amortization of actuarial loss	2,259	2,557	4,536	5,114
Loss on lump-sum settlement	3,407	0	3,407	0
Sub-total	8,056	5,098	12,765	10,196
Regulatory adjustment	(484)	(862)	(967)	(4,395)
Net benefit cost	7,572	4,236	11,798	5,801
Postretirement Benefit [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Service cost - benefits earned during the period	2,015	1,919	4,030	3,838
Interest Cost	1,380	1,211	2,760	2,422
Expected return on plan assets	(991)	(912)	(1,982)	(1,823)
Amortization of transition obligation	34	34	68	68
Amortization of prior service cost (credit)	(518)	(582)	(1,036)	(1,164)
Amortization of actuarial loss	1,065	1,111	2,130	2,221
Sub-total	2,985	2,781	5,970	5,562
Regulatory adjustment	(604)	(400)	(1,208)	(1,271)
Net benefit cost	$ 2,381	$ 2,381	$ 4,762	$ 4,291

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PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS Part 2 (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Mar. 31, 2012	Dec. 31, 2010	Aug. 01, 2007
Pension Plans and Other Postretirement Benefits [Abstract]
Extent of Lump-sum payments recognized, percentage	100%
Lump-sum payments recognized as settlements	$ 6.4
Implementation period used to calculate return on plan assets (in years)	four-year
Gains or losses includible in cost amortized to extent exceeds benefit obligations or market-related value of plan assets, percentage.	10.00%
Recovery in rates for the qualified pension plans base allowance		15.5	4.8
Recovery in rates for postretirement benefit		9.5	7.6
Defined Benefit Plan, Pension Plans, Qualified Trusts, Contributions by Employer, Fiscal Year To Date	22.9
Defined Benefit Plan, Pension Plans, Non-Qualified Plans, Contributions by Emplyer, Fiscal Year To Date	2.0
Defined Benefit Plan, Pension Plans, Qualified Trusts, Estimated Future Employer Contributions Remaining For Current Fiscal Year, Description	10.5
Defined Benefit Plan, Pension Plans, Non-Qualified Plans, Estimated Future Employer Contributions Remaining For Current Fiscal Year, Description	4.7
Medical insurance available until age is reached after early retirement	65
Amortization period for transition obligation excluded from postretirement benefit cost (in years)	20 years
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Defined Benefit Plan, Other Postretirement Benefit Plans, Qualified Trusts, Contributions by Employer, Fiscal Year To Date	3.0
Defined Benefit Plan, Other Postretirement Benefit Plans, Non-Qualified Plans, Contributions by Employer, Fiscal Year To Date	0.1
Defined Benefit Plan, Other Postretirement Benefit Plans, Qualified Trusts, Estimated Future Employer Contributions Remaining for Current Fiscal Year, Description	9.0
Defined Benefit Plan, Other Postretirement Benefit Plans, Estimated Future Payment Directly to Participants, Description	$ 0.2

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PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS

6 Months Ended

Mar. 31, 2012

Pension Plans and Other Postretirement Benefits [Abstract]

PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS

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 equity market exposure achieved through derivative instruments.

Pension costs for the quarters ended March 31, 2012 and 2011 were $7.6 million and $4.2 million, respectively, including amounts charged to construction. Pension costs for the six months ended March 31, 2012 and 2011 were $11.8 million and $5.8 million, respectively, including amounts charged to construction.

The net periodic pension costs include the following components:

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Service cost – benefits earned during the period	$	2,301		$	2,388		$	4,613		$	4,776
Interest cost on projected benefit obligation		4,840			4,705			9,711			9,410
Expected return on plan assets		(4,899	)		(4,712	)		(9,798	)		(9,424	)
Amortization of prior service cost		148			160			296			320
Amortization of actuarial loss		2,259			2,557			4,536			5,114
Loss on lump-sum settlement		3,407			—			3,407			—
Sub-total		8,056			5,098			12,765			10,196
Regulatory adjustment		(484	)		(862	)		(967	)		(4,395	)
Net pension cost	$	7,572		$	4,236		$	11,798		$	5,801

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 $6.4 million during the six months ended March 31, 2012. No lump-sum payments were recognized as settlements during the six months ended March 31, 2011.

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 $4.8 million effective August 1, 2007 and $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 2012 contributions to the pension plans through March 31, 2012 were $22.9 million to the qualified trusts and approximately $2.0 million to the non-qualified plans. Contributions to the pension plans for the remaining six months of fiscal year 2012 are anticipated to be at least $10.5 million to the qualified trusts and $4.7 million to the non-qualified plans.

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 March 31, 2012 and 2011 were $2.4 million, including amounts charged to construction. Postretirement benefit costs for the six months ended March 31, 2012 and 2011 were $4.8 million and $4.3 million, respectively, including amounts charged to construction.

Net periodic postretirement benefit costs consisted of the following components:

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Service cost – benefits earned during the period	$	2,015		$	1,919		$	4,030		$	3,838
Interest cost on accumulated
postretirement benefit obligation		1,380			1,211			2,760			2,422
Expected return on plan assets		(991	)		(912	)		(1,982	)		(1,823	)
Amortization of transition obligation		34			34			68			68
Amortization of prior service credit		(518	)		(582	)		(1,036	)		(1,164	)
Amortization of actuarial loss		1,065			1,111			2,130			2,221
Sub-total		2,985			2,781			5,970			5,562
Regulatory adjustment		(604	)		(400	)		(1,208	)		(1,271	)
Net postretirement benefit cost	$	2,381		$	2,381		$	4,762		$	4,291

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 $7.6 million effective August 1, 2007 and $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 2012 contributions to the postretirement plans through March 31, 2012 were $3.0 million to the qualified trusts and approximately $0.1 million paid directly to participants from Laclede Gas’ funds. Contributions to the postretirement plans for the remaining six months of fiscal year 2012 are anticipated to be $9.0 million to the qualified trusts and $0.2 million paid directly to participants from Laclede Gas’ funds.

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STOCK-BASED COMPENSATION (Details) (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012 Y	Mar. 31, 2011	Mar. 31, 2012 Restricted Stock Awards [Member]	Mar. 31, 2012 Restricted Stock Awards [Member] Time Vested Restricted Stock and Time Vested Restricted Stock Units [Member]	Mar. 31, 2012 Restricted Stock Awards [Member] Non Employee Directors [Member] Time Vested Restricted Stock and Time Vested Restricted Stock Units [Member]	Mar. 31, 2012 Restricted Stock Awards [Member] Executive Officers and Key Employees [Member] Performance Contingent Restricted Stock and Stock Units [Member]	Mar. 31, 2012 Restricted Stock Awards [Member] Executive Officers and Key Employees [Member] Time Vested Restricted Stock and Time Vested Restricted Stock Units [Member]	Mar. 31, 2012 Stock Option Awards [Member] Stock Options [Member] Y	Sep. 30, 2011 Stock Option Awards [Member] Stock Options [Member]
Restricted Stock Awards [Abstract]
Granted (in shares)						43,775	13,700	101,963	30,075
Granted, weighted average grant date fair value (per share)						$ 40.23	$ 41.36	$ 36.55	$ 39.72
Vested restricted stock withheld for tax withholding obligations (in shares)					29,157
Vested restricted stock withheld for tax withholding obligations, weighted average price (in dollars per share)					$ 39.96
Restricted shares/units activity [Roll-Forward]
Nonvested, beginning of period (in shares)						143,350		259,075
Granted (in shares)						43,775	13,700	101,963	30,075
Vested (in shares)					(88,129)	(54,400)		(48,429)
Forfeited (in shares)						(12,700)		(79,072)
Nonvested, end of period (in shares)						120,025		233,537
Weighted average Grant Date Fair Value [Abstract]
Nonvested Beginning Balance, weighted average grant date fair value (per share)						$ 37.00		$ 34.29
Granted, weighted average grant date fair value (per share)						$ 40.23	$ 41.36	$ 36.55	$ 39.72
Vested, weighted average grant date fair value (per share)						$ 41.48		$ 48.70
Forfeited, weighted average grant date fair value (per share)						$ 33.53		$ 38.43
Nonvested Ending Balance, weighted average grant date fair value (per share)						$ 36.51		$ 30.88
Stock Options - Shares [Roll Forward]
Outstanding Balance - stock options										262,250	305,875
Fully Vested and Expected to Vest, end of period (in shares)										262,250
Exercisable, end of period (in shares)										262,250
Granted - stock options (in shares)										0
Exercised - stock options (in shares)										(43,625)
Forfeited - stock options (in shares)										0
Expired - stock options (in shares)										0
Stock Options - Shares Weighted Average Exercise Price [Abstract]
Outstanding Beginning Balance, weighted average exercise price - stock options (per share)										$ 30.74	$ 30.72
Granted, weighted average exercise price - stock options (per share)										$ 0.00
Exercised, weighted average exercise price - stock options (per share)										$ 30.63
Forfeited, weighted average exercise price - stock options (per share)										$ 0.00
Expired, weighted average exercise price - stock options (per share)										$ 0.00
Outstanding Ending Balance, weighted average exercise price - stock options (per share)										$ 30.74	$ 30.72
Fully Vested and Expected to Vest at End of Period, weighted average exercise price - stock options (per share)										$ 30.74
Exercisable at End of Period, weighted average exercise price - stock options (per share)										$ 30.74
Outstanding Ending Balance, weighted average remaining contractual term - stock options (in years)										2.8
Fully Vested and Expected to Vest at End of Period, weighted average remaining contractual term - stock options (in years)										2.8
Exercisable at End of Period, weighted average remaining contractual term - stock options (in years)										2.8
Outstanding Ending Balance, aggregate intrinsic value - stock options										$ 2,172,000
Fully Vested and Expected to Vest at End of Period, aggregate intrinsic value - stock options										2,172,000
Exercisable at End of Period, aggregate intrinsic value - stock options										2,172,000
Stock Option Awards [Abstract]
Common stock closing price (per share)	$ 39.02		$ 39.02
Total equity compensation cost	684,000	822,000	1,351,000	1,540,000
Compensation cost capitalized	(221,000)	(177,000)	(359,000)	(331,000)
Compensation cost recognized in net income	463,000	645,000	992,000	1,209,000
Income tax benefit recognized in net income	(179,000)	(248,000)	(383,000)	(466,000)
Compensation cost recognized in net income, net of income tax	284,000	397,000	609,000	743,000
Total unrecognized compensation cost	$ 5,500,000		$ 5,500,000
Weighted average period cost to be recognized (in years)			2.5

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COMMITMENTS AND CONTINGENCIES (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended	12 Months Ended
	Mar. 31, 2012	Sep. 30, 2007	Sep. 30, 2006	Apr. 27, 2012
Commitments [Abstract]
Approximate contract amount of project	$ 7
Minimum total payments required for natural gas contracts	394
Leases and Guarantees [Abstract]
Guaranteed amount for performance and payment of certain wholesale gas supply purchases	86.3			84.3
Increase (decrease) in guaranteed amount for performance and payment of certain wholesale gas supply purchases	(2.0)
Contingencies and Indemnifications [Abstract]
Number of former manufactured gas plant (MGP) sites in Missouri	three
Number of former manufactured gas plant (MGP) sites in Shrewsbury, Missouri	one
Number of former manufactured gas plant (MGP) sites in the City of St. Louis	two
Minimum cost estimate for a one-time contractual transfer of risk	5.8
Maximum cost estimate for a one-time contractual transfer of risk	36.3
Original proposed disallowance amount related to recovery of purchased gas costs	7.2	1.5	2.8
Adjusted proposed disallowance amount related to purchase gas costs	1.7
Amount remaining on deposit with a brokerage firm for Laclede Gas				1.5
Amount remaining on deposit with a brokerage firm for Laclede Energy Resources, Inc.				$ 0.5

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STATEMENTS OF CONSOLIDATED INCOME (UNAUDITED) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011
Operating Revenues:
Regulated Gas Distribution	$ 298,620	$ 388,375	$ 549,522	$ 665,818
Non-Regulated Gas Marketing	59,434	155,111	218,022	321,519
Other	121	292	1,544	643
Total Operating Revenues	358,175	543,778	769,088	987,980
Regulated Gas Distribution
Natural and propane gas	171,164	260,706	317,915	434,071
Other operation expenses	38,043	39,500	75,608	74,362
Maintenance	5,761	6,441	11,069	12,581
Depreciation and amortization	10,175	9,739	20,264	19,377
Taxes, other than income taxes	20,093	24,686	34,760	40,434
Total Regulated Gas Distribution Operating Expenses	245,236	341,072	459,616	580,825
Non-Regulated Gas Marketing	61,805	152,302	214,364	315,655
Other	551	461	1,420	806
Total Operating Expenses	307,592	493,835	675,400	897,286
Operating Income	50,583	49,943	93,688	90,694
Other Income and (Income Deductions) - Net	1,381	467	3,320	2,312
Interest Charges:
Interest on long-term debt	5,740	5,740	11,479	11,682
Other interest charges	539	549	1,114	1,293
Total Interest Charges	6,279	6,289	12,593	12,975
Income Before Income Taxes	45,685	44,121	84,415	80,031
Income Tax Expense	16,001	16,228	29,557	28,769
Net Income	$ 29,684	$ 27,893	$ 54,858	$ 51,262
Weighted Average Number of Common Shares Outstanding:
Basic	22,254	22,100	22,223	22,070
Diluted	22,336	22,172	22,299	22,145
Basic Earnings Per Share of Common Stock:
Basic Earnings Per Share of Common Stock	$ 1.33	$ 1.25	$ 2.45	$ 2.30
Diluted Earnings Per Share of Common Stock:
Diluted Earnings Per Share of Common Stock	$ 1.32	$ 1.25	$ 2.45	$ 2.30
Dividends Declared Per Share of Common Stock	$ 0.415	$ 0.405	$ 0.830	$ 0.810

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STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Operating Activities:
Net Income	$ 54,858	$ 51,262
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation, amortization, and accretion	20,565	19,635
Deferred income taxes and investment tax credits	6,167	(9,012)
Other - net	(744)	71
Changes in assets and liabilities:
Accounts receivable - net	(20,355)	(58,721)
Unamortized purchased gas adjustments	14,478	17,248
Deferred purchased gas costs	(30,160)	60,725
Accounts payable	(26,546)	2,658
Delayed customer billings - net	(28,694)	(49,207)
Taxes accrued	12,575	25,997
Natural gas stored underground	57,714	73,351
Other assets and liabilities	11,601	5,987
Net cash provided by operating activities	71,459	139,994
Investing Activities:
Capital expenditures	(40,658)	(29,746)
Other investments	(1,440)	(1,514)
Net cash used in investing activities	(42,098)	(31,260)
Financing Activities:
Maturity of first mortgage bonds	0	(25,000)
Repayment of short-term debt - net	(46,000)	(129,650)
Changes in book overdrafts	357	(291)
Issuance of common stock	2,195	1,427
Non-employee directors' restricted stock awards	(565)	(494)
Dividends paid	(18,314)	(17,782)
Employees' taxes paid associated with restricted shares withheld upon vesting	(1,165)	(1,162)
Excess tax benefits from stock-based compensation	185	265
Other	(29)	16
Net cash used in financing activities	(63,336)	(172,671)
Net Decrease in Cash and Cash Equivalents	(33,975)	(63,937)
Cash and Cash Equivalents at Beginning of Period	43,277	86,919
Cash and Cash Equivalents at End of Period	9,302	22,982
Supplemental Disclosure of Cash Paid During the Period for:
Interest	12,521	13,241
Income taxes	$ 2,763	$ 5,651

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FAIR VALUE MEASUREMENTS (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012 Fair Value, Measurements, Recurring [Member] Quoted Prices in Active Markets (Level 1) [Member]	Sep. 30, 2011 Fair Value, Measurements, Recurring [Member] Quoted Prices in Active Markets (Level 1) [Member]	Mar. 31, 2011 Fair Value, Measurements, Recurring [Member] Quoted Prices in Active Markets (Level 1) [Member]	Mar. 31, 2012 Fair Value, Measurements, Recurring [Member] Significant Observable Inputs (Level 2) [Member]	Sep. 30, 2011 Fair Value, Measurements, Recurring [Member] Significant Observable Inputs (Level 2) [Member]	Mar. 31, 2011 Fair Value, Measurements, Recurring [Member] Significant Observable Inputs (Level 2) [Member]	Mar. 31, 2012 Fair Value, Measurements, Recurring [Member] Significant Unobservable Inputs (Level 3) [Member]	Sep. 30, 2011 Fair Value, Measurements, Recurring [Member] Significant Unobservable Inputs (Level 3) [Member]	Mar. 31, 2011 Fair Value, Measurements, Recurring [Member] Significant Unobservable Inputs (Level 3) [Member]	Mar. 31, 2012 Fair Value, Measurements, Recurring [Member] Effects of Netting and Cash Margin Receivables Payables [Member]	Sep. 30, 2011 Fair Value, Measurements, Recurring [Member] Effects of Netting and Cash Margin Receivables Payables [Member]	Mar. 31, 2011 Fair Value, Measurements, Recurring [Member] Effects of Netting and Cash Margin Receivables Payables [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
U. S. Stock/Bond Mutual Funds					$ 17,907	$ 14,833	$ 17,022	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
NYMEX/ICE natural gas contracts- Asset					5,182	4,856	5,718	1,310	0	0	0	0	0	(4,881)	1,975	4,416
NYMEX gasoline and heating oil contracts- Asset					81	19	369	0	0	0	0	0	0	(81)	162	(38)
Natural gas commodity contracts- Asset					0	0	0	4,362	2,018	930	79	66	57	(538)	(108)	(151)
Total Assets					23,170	19,708	23,109	5,672	2,018	930	79	66	57	(5,500)	2,029	4,227
NYMEX/ICE natural gas contracts- Liabilities					37,811	20,928	27,841	2,342	0	0	0	0	0	(40,153)	(20,928)	(27,841)
NYMEX gasoline & heating oil contracts- Liabilities						124			0			0			(124)
Natural gas commodity contracts- Liabilities					0	0	0	1,190	109	313	21	53	33	(538)	(108)	(151)
Total Liabilities					37,811	21,052	27,841	3,532	109	313	21	53	33	(40,691)	(21,160)	(27,992)
Beginning of period	37	76	13	23
Settlements	(41)	(81)	(7)	(52)
Net losses related to derivatives not held at end of period	(1)	(5)	(4)	(16)
Net gains related to derivatives still held at end of period	63	34	56	69
End of period	$ 58	$ 24	$ 58	$ 24

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EARNINGS PER COMMON SHARE (Tables)

6 Months Ended

Mar. 31, 2012

EARNINGS PER COMMON SHARE [Abstract]

Earnings Per Common Share

Three Months Ended				Six Months Ended
		March 31,				March 31,
	(Thousands, Except Per Share Amounts)		2012		2011		2012		2011
	Basic EPS:
	Net Income	$	29,684	$	27,893	$	54,858	$	51,262
	Less: Income allocated to participating securities		167		226		324		430
	Net Income Available to Common Shareholders	$	29,517	$	27,667	$	54,534	$	50,832
	Weighted Average Shares Outstanding		22,254		22,100		22,223		22,070
	Earnings Per Share of Common Stock	$	1.33	$	1.25	$	2.45	$	2.30
	Diluted EPS:
	Net Income	$	29,684	$	27,893	$	54,858	$	51,262
	Less: Income allocated to participating securities		166		226		323		429
	Net Income Available to Common Shareholders	$	29,518	$	27,667	$	54,535	$	50,833
	Weighted Average Shares Outstanding		22,254		22,100		22,223		22,070
	Dilutive Effect of Stock Options
	and Restricted Stock		82		72		76		75
	Weighted Average Diluted Shares		22,336		22,172		22,299		22,145
	Earnings Per Share of Common Stock	$	1.32	$	1.25	$	2.45	$	2.30
	Outstanding Shares Excluded from the
	Calculation of Diluted EPS Attributable to:
	Restricted stock and stock units subject to
	performance and/or market conditions		203		193		203		193

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) (USD $)	6 Months Ended																												3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended
	Mar. 31, 2012 MMBTU gal	Sep. 30, 2011	Mar. 31, 2011	Mar. 31, 2012 NYMEX/ICE Natural Gas Contracts [Member] Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Sep. 30, 2011 NYMEX/ICE Natural Gas Contracts [Member] Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2011 NYMEX/ICE Natural Gas Contracts [Member] Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Sep. 30, 2011 NYMEX/ICE Natural Gas Contracts [Member] Designated as Hedging Instrument [Member] Other Deferred Charges [Member]	Mar. 31, 2011 NYMEX/ICE Natural Gas Contracts [Member] Designated as Hedging Instrument [Member] Other Deferred Charges [Member]	Mar. 31, 2012 NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Sep. 30, 2011 NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2011 NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Sep. 30, 2011 NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member] Other Deferred Charges [Member]	Mar. 31, 2011 NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member] Other Deferred Charges [Member]	Mar. 31, 2012 NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member] Accounts Receivable - Other [Member]	Sep. 30, 2011 NYMEX Gasoline and Heating Oil Contracts [Member] Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2011 NYMEX Gasoline and Heating Oil Contracts [Member] Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2012 NYMEX Gasoline and Heating Oil Contracts [Member] Designated as Hedging Instrument [Member] Accounts Receivable - Other [Member]	Sep. 30, 2011 NYMEX Gasoline and Heating Oil Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2011 NYMEX Gasoline and Heating Oil Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2012 NYMEX Gasoline and Heating Oil Contracts [Member] Not Designated as Hedging Instrument [Member] Accounts Receivable - Other [Member]	Mar. 31, 2012 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Sep. 30, 2011 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2011 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Derivative Instruments Assets [Member]	Mar. 31, 2012 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Other Deferred Charges [Member]	Sep. 30, 2011 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Other Deferred Charges [Member]	Mar. 31, 2012 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Other Current Liabilities [Member]	Sep. 30, 2011 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Other Current Liabilities [Member]	Mar. 31, 2011 Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member] Other Current Liabilities [Member]	Mar. 31, 2012 Other Comprehensive Income (Loss) [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Other Comprehensive Income (Loss) [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Other Comprehensive Income (Loss) [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Other Comprehensive Income (Loss) [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Other Comprehensive Income (Loss) [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Other Comprehensive Income (Loss) [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Other Comprehensive Income (Loss) [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Other Comprehensive Income (Loss) [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Revenue [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Revenue [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Revenue [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Revenue [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Revenue [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Expenses [Member] NYMEX/ICE Natural Gas Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Expenses [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Expenses [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Non-Regulated Gas Marketing Operating Expenses [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Non-Regulated Gas Marketing Operating Expenses [Member] Natural Gas Commodity Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Regulated Gas Distribution Other Operation Expenses [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Regulated Gas Distribution Other Operation Expenses [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Regulated Gas Distribution Other Operation Expenses [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2011 Regulated Gas Distribution Other Operation Expenses [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Cash Flow Hedging [Member]	Mar. 31, 2012 Other Income and (Income Deduction) - Net [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Other Income and (Income Deduction) - Net [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Other Income and (Income Deduction) - Net [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2011 Other Income and (Income Deduction) - Net [Member] NYMEX Gasoline and Heating Oil Contracts [Member] Not Designated as Hedging Instrument [Member]	Mar. 31, 2012 Laclede Gas Company [Member] MMBTU	Mar. 31, 2012 Laclede Gas Company [Member] Fiscal 2012 [Member] Open Short Futures Positions [Member]	Mar. 31, 2012 Laclede Gas Company [Member] Fiscal 2012 [Member] Open Long Futures Positions [Member] MMBTU	Mar. 31, 2012 Laclede Gas Company [Member] Fiscal 2013 [Member] Open Short Futures Positions [Member]	Mar. 31, 2012 Laclede Gas Company [Member] Fiscal 2013 [Member] Open Long Futures Positions [Member] MMBTU	Mar. 31, 2012 Laclede Gas Company [Member] Fiscal 2014 [Member] Open Long Futures Positions [Member] MMBTU	Mar. 31, 2012 Laclede Energy Resources [Member] MMBTU	Mar. 31, 2012 Laclede Energy Resources [Member] Fiscal 2012 [Member] Open Short Futures Positions [Member] MMBTU	Mar. 31, 2012 Laclede Energy Resources [Member] Fiscal 2012 [Member] Open Long Futures Positions [Member] MMBTU	Mar. 31, 2012 Laclede Energy Resources [Member] Fiscal 2013 [Member] Open Short Futures Positions [Member] MMBTU	Mar. 31, 2012 Laclede Energy Resources [Member] Fiscal 2013 [Member] Open Long Futures Positions [Member] MMBTU	Mar. 31, 2012 Laclede Energy Resources [Member] Fiscal 2014 [Member] Open Long Futures Positions [Member] MMBTU
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES [Abstract]
Maximum percentage of normal volumes hedged	70%
Maximum number of months normal volumes can be hedged (in months)	36-month
Derivative [Line Items]
Gasoline futures contracts notional amount (in millions of gallons)	0.1
Average price of gasoline futures contracts (dollars per gallon)	$ 2.99
Gasoline options contracts notional amount (in millions of gallons)	0.3
Notional amount of non-exchange traded natural gas commodity contracts (in MMBtu, in millions)	88.6
Notional amount of non-exchange traded natural gas commodity contracts to be settled during fiscal 2012 (in MMBtu, in millions)	64.9
Notional amount of non-exchange traded natural gas commodity contracts to be settled during fiscal 2013 (in MMBtu, in millions)	23.7
Expected pre-tax unrealized gain reclassifications into the Statements of Consolidated Income during the next twelve months	6,400,000
MMBtu (millions)																																																																						0.00	9.49	0.00	21.86	0.80		3.92	1.63	6.78	1.43	0.10
Avg. Price Per MMBtu																																																																						0.00	4.22	0.00	4.16	3.51		3.01	3.89	3.29	3.90	4.34
Contract volumes of NYMEX natural gas option used to mitigate price risk (in MMBtu, in millions)																																																																					11.8						4.1
Derivatives in Cash Flow Hedging Relationships [Abstract]
Effective portion of gain (loss) recognized in OCI on derivatives																													5,023,000	693,000	8,020,000	734,000	83,000	267,000	133,000	440,000
Effective portion of gain (loss) reclassiffied from AOCI to income																																					4,048,000	757,000	10,788,000	5,591,000									(4,445,000)	(682,000)	(8,369,000)	(2,475,000)									(11,000)	72,000	3,000	121,000
Ineffective portion of gain (loss) on derivatives recognized in income																																					50,000	551,000	69,000	560,000									(90,000)	(498,000)	(196,000)	(623,000)									28,000	19,000	34,000	48,000
Derivatives Not Designated as Hedging Instruments [Abstract]
Gain (loss) recognized in income on derivatives																																									1,478,000	(42,000)	1,548,000	(78,000)	1,557,000	143,000	790,000	(299,000)					30,000	0	30,000	0	0	746,000	687,000	1,196,000					12,000	47,000	13,000	63,000
Derivatives, Fair Value [Line Items]
Asset Derivatives Fair Value	11,014,000	6,960,000	7,074,000	3,545,000	4,395,000	688,000	4,000	11,000	2,238,000	457,000	4,353,000	0	666,000	709,000	15,000	341,000	72,000	4,000	28,000	9,000	4,176,000	1,894,000	957,000	217,000	183,000	48,000	8,000	30,000
Liabilities Fair Value	41,364,000	21,214,000	28,187,000	3,242,000	4,105,000	10,926,000	85,000	61,000	474,000	16,330,000	16,854,000	408,000	0	36,437,000	117,000	0	0	7,000	0	0	490,000	100,000	121,000	0	0	721,000	62,000	225,000
Derivative instrument assets reconciliation [Abstract]
Fair value of asset derivatives presented above	11,014,000	6,960,000	7,074,000	3,545,000	4,395,000	688,000	4,000	11,000	2,238,000	457,000	4,353,000	0	666,000	709,000	15,000	341,000	72,000	4,000	28,000	9,000	4,176,000	1,894,000	957,000	217,000	183,000	48,000	8,000	30,000
Fair value of cash margin receivables offset with derivatives	35,648,000	23,188,000	32,258,000
Netting of assets and liabilities with the same counterparty	(41,148,000)	(21,160,000)	(28,031,000)
Derivative Assets	5,514,000	8,988,000	11,301,000
Derivative Instrument Assets, per Consolidated Balance Sheets: [Abstract]
Derivative instrument assets	5,297,000	7,759,000	10,491,000
Other deferred charges derivative instruments	217,000	1,229,000	810,000
Derivative Assets	5,514,000	8,988,000	11,301,000
Fair value of liability derivatives presented above	41,364,000	21,214,000	28,187,000	3,242,000	4,105,000	10,926,000	85,000	61,000	474,000	16,330,000	16,854,000	408,000	0	36,437,000	117,000	0	0	7,000	0	0	490,000	100,000	121,000	0	0	721,000	62,000	225,000
Fair value of cash margin payables offset with derivatives	457,000	0	39,000
Netting of assets and liabilities with the same counterparty	(41,148,000)	(21,160,000)	(28,031,000)
Derivative instrument liabilities, per Consolidated Balance Sheets	$ 673,000	$ 54,000	$ 195,000

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FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Mar. 31, 2012

Fair Value Measurements [Abstract]

Fair Value Measurements, Measured on Recurring Basis

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 March 31, 2012
Assets
U. S. Stock/Bond Mutual Funds	$	17,907	$	-	$	-	$	-		$	17,907
NYMEX/ICE natural gas contracts		5,182		1,310		-		(4,881	)		1,611
NYMEX gasoline and heating
oil contracts		81		-		-		(81	)		-
Natural gas commodity contracts		-		4,362		79		(538	)		3,903
Total	$	23,170	$	5,672	$	79	$	(5,500	)	$	23,421
Liabilities
NYMEX/ICE natural gas contracts	$	37,811	$	2,342	$	-	$	(40,153	)	$	-
Natural gas commodity contracts		-		1,190		21		(538	)		673
Total	$	37,811	$	3,532	$	21	$	(40,691	)	$	673
As of September 30, 2011
Assets
U. S. Stock/Bond Mutual Funds	$	14,833	$	-	$	-	$	-		$	14,833
NYMEX/ICE natural gas contracts		4,856		-		-		1,975			6,831
NYMEX gasoline and heating
oil contracts		19		-		-		162			181
Natural gas commodity contracts		-		2,018		66		(108	)		1,976
Total	$	19,708	$	2,018	$	66	$	2,029		$	23,821
Liabilities
NYMEX/ICE natural gas contracts	$	20,928	$	-	$	-	$	(20,928	)	$	-
NYMEX gasoline and heating
oil contracts		124		-		-		(124	)		-
Natural gas commodity contracts		-		109		53		(108	)		54
Total	$	21,052	$	109	$	53	$	(21,160	)	$	54
As of March 31, 2011
Assets
U. S. Stock/Bond Mutual Funds	$	17,022	$	-	$	-	$	-		$	17,022
NYMEX/ICE natural gas contracts		5,718		-		-		4,416			10,134
NYMEX gasoline and heating
oil contracts		369		-		-		(38	)		331
Natural gas commodity contracts		-		930		57		(151	)		836
Total	$	23,109	$	930	$	57	$	4,227		$	28,323
Liabilities
NYMEX/ICE natural gas contracts	$	27,841	$	-	$	-	$	(27,841	)	$	-
Natural gas commodity contracts		-		313		33		(151	)		195
Total	$	27,841	$	313	$	33	$	(27,992	)	$	195

Reconciliation of the Level 3 beginning and ending net derivative balances

Three Months Ended					Six Months Ended
		March 31,						March 31,
	(Thousands)	2012			2011			2012			2011
	Beginning of period	$	37		$	76		$	13		$	23
	Settlements		(41	)		(81	)		(7	)		(52	)
	Net losses related to derivatives not held   at end of period		(1	)		(5	)		(4	)		(16	)
	Net gains related to derivatives still held   at end of period		63			34			56			69
	End of period	$	58		$	24		$	58		$	24

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Mar. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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 2011 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 flowsof 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 was formed in October 2011 and became operational on January 1, 2012.

BASIS OF CONSOLIDATION - The consolidated financial statements include the accounts of Laclede Group and its subsidiary companies. All subsidiaries are wholly owned. Laclede Gas and other subsidiaries of Laclede Group may engage in related party transactions during the ordinary course of business. All material intercompany balances have been eliminated from the consolidated financial statements of Laclede Group. These transactions include sales of natural gas from Laclede Gas to LER, sales of natural gas from LER to Laclede Gas, and transportation services provided by Laclede Pipeline Company to Laclede Gas. These revenues are shown on the Intersegment revenues lines in the table included in Note 10 under Regulated Gas Distribution, Non-Regulated Gas Marketing, and Other columns, respectively.

NATURAL GAS STORED UNDERGROUND – Inventory of Utility natural gas in storage is priced on a last-in, first-out (LIFO) basis. The carrying value of Utility inventory is not adjusted to the lower of cost or market prices because, pursuant to the Laclede Gas Purchased Gas Adjustment (PGA) Clause, actual gas costs are recovered in customer rates. Natural gas storage inventory in the Non-Regulated Gas Marketing operating segment is recorded at the lower of average cost or market.

REVENUE RECOGNITION - Laclede Gas reads meters and bills its customers on monthly cycles. The Utility records its regulated gas distribution 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 March 31, 2012 and 2011, for the Utility, were $13.0 million and $29.0 million, respectively. The amount of accrued unbilled revenue at September 30, 2011 was $11.8 million.

In the course of its business, LER 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, “Derivatives and Hedging.” As such, those contracts are accounted for as executory contracts and recorded on an accrual basis. Revenues and expenses from such contracts are recorded using a gross presentation. Contracts not designated as normal purchases or normal sales are recorded as derivatives with changes in fair value (representing unrealized gains and losses) recognized in earnings the periods prior to physical delivery. For additional information on derivative instruments, refer to Note 7, Derivative Instruments and Hedging Activities. Certain of LER’s wholesale purchase and sale transactions entered on or after January 1, 2012 are classified as trading activities for financial reporting purposes rather than elected for normal purchases or normal sales designations. Under generally accepted accounting principles (GAAP), revenues and expenses associated with trading activities are presented on a net basis in Non-Regulated Gas Marketing Operating Revenues in the Statements of Consolidated Income. This net presentation has no effect on operating income or net income.

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 Regulated Gas Distribution Operating Revenues for the quarters ended March 31, 2012 and 2011 were $15.5 million and $20.3 million, respectively. Amounts recorded in Regulated Gas Distribution Operating Revenues for the six months ended March 31, 2012 and 2011 were $25.7 million and $31.6 million, respectively. Gross receipts taxes are expensed by the Utility and included in the Taxes, other than income taxes line.

NEW ACCOUNTING STANDARDS – In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-04, “Amendments to Achieve Common Fair Value Measurement Disclosure Requirements in U.S. GAAP and IFRSs.” This ASU amends Accounting Standards Codification (ASC) Topic 820, “Fair Value Measurements and Disclosures,” to improve the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards (IFRS). The ASU does not change what items are measured at fair value, but instead makes various changes to the guidance pertaining to how fair value is measured. Additionally, the ASU sets forth additional disclosure requirements, including additional information about Level 3 fair value measurements. Many of the amendments in this ASU are changes to align the wording in U.S. GAAP with IFRS and, as such, are not intended to result in a change in the application of the guidance. The Company’s adoption of the guidance in this ASU on a prospective basis in the second quarter of fiscal year 2012 had no impact on its financial condition or results of operations, but certain additional disclosures have been presented as required.

In June 2011, the FASB issued 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, will not impact total net income, comprehensive income, or earnings per share.

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.

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STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (UNAUDITED) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011
Other Comprehensive Income [Abstract]
Net Income	$ 29,684	$ 27,893	$ 54,858	$ 51,262
Net gains (losses) on cash flow hedging derivative instruments:
Net hedging gain arising during the period	5,106	960	8,153	1,174
Reclassification adjustment for losses (gains) included in net income	408	(147)	(2,422)	(3,237)
Net unrealized gains (losses) on cash flow hedging derivative instruments	5,514	813	5,731	(2,063)
Defined benefit pension and other postretirement benefit plans:
Net actuarial loss arising during the period	(2,366)	0	(2,366)	0
Amortization of actuarial loss included in net periodic pension and postretirement benefit cost	3,482	106	3,573	213
Net defined benefit pension and other postretirement plans	1,116	106	1,207	213
Other Comprehensive Income (Loss), Before Tax	6,630	919	6,938	(1,850)
Income Tax Expense (Benefit) Related to Items of Other Comprehensive Income (Loss)	2,561	355	2,680	(715)
Other Comprehensive Income (Loss), Net of Tax	4,069	564	4,258	(1,135)
Comprehensive Income	$ 33,753	$ 28,457	$ 59,116	$ 50,127

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Mar. 31, 2012

COMMITMENTS AND CONTINGENCIES [Abstract]

COMMITMENTS AND CONTINGENCIES

11. COMMITMENTS AND CONTINGENCIES

Commitments

Laclede Gas and LER have entered into various contracts, expiring on dates through 2017, for the storage, transportation, and supply of natural gas. Minimum payments required under the contracts in place at March 31, 2012 are estimated at approximately $394 million. Additional contracts are generally entered into prior to or during the heating season. Laclede Gas recovers its costs from customers in accordance with the PGA Clause.

During fiscal 2011, the Utility initiated a multi-year project to replace its existing work management, financial, and supply chain software applications to enhance its technology, customer service, and business processes. At March 31, 2012, the Company was contractually committed to costs of approximately $7 million related to this project, with additional expenditures to be incurred throughout the project’s life.

Guarantees

Laclede Group had guarantees totaling $86.3 million for performance and payment of certain gas supply transactions by LER, as of March 31, 2012. Since that date, total guarantees issued by Laclede Group on behalf of LER decreased by $2.0 million, bringing the total to $84.3 million in guarantees outstanding at April 27, 2012. No amounts have been recorded for these guarantees in the financial statements. As of March 31, 2012, management believes the probability is low that Laclede Group will be required to make payments under these guarantees.

Contingencies

Laclede Gas owns and operates natural gas distribution, transmission, and storage facilities, the operations of which are subject to various environmental laws, regulations, and interpretations. While environmental issues resulting from such operations arise in the ordinary course of business, such issues have not materially affected the Company’s or Laclede Gas’ financial position and results of operations. As environmental laws, regulations, and their interpretations change, however, Laclede Gas may be required to incur additional costs.

Similar to other natural gas utility companies, Laclede Gas faces the risk of incurring environmental liabilities. In the natural gas industry, these are typically associated with sites formerly owned or operated by gas distribution companies like Laclede Gas and/or its predecessor companies at which manufactured gas operations took place. At this time, Laclede Gas has identified three former manufactured gas plant (MGP) sites where costs have been incurred and claims have been asserted: one in Shrewsbury, Missouri and two in the City of St. Louis, Missouri.

With regard to the former MGP site located in Shrewsbury, Missouri, Laclede Gas and state and federal environmental regulators agreed upon certain remedial actions to a portion of the site in a 1999 Administrative Order on Consent (AOC), which actions have been completed. On September 22, 2008, EPA Region VII issued a letter of Termination and Satisfaction terminating the AOC. However, if after this termination of the AOC, regulators require additional remedial actions, or additional claims are asserted, Laclede Gas may incur additional costs.

One of the sites located in the City of St. Louis is currently owned by a development agency of the City, which, together with other City development agencies, has selected a developer to redevelop the site. In conjunction with this redevelopment effort, Laclede Gas and another former owner of the site entered into an agreement (Remediation Agreement) with the City development agencies, the developer, and an environmental consultant that obligates one of the City agencies and the environmental consultant to remediate the site and obtain a No Further Action letter from the Missouri Department of Natural Resources. The Remediation Agreement also provides for a release of Laclede Gas and the other former site owner from certain liabilities related to the past and current environmental condition of the site and requires the developer and the environmental consultant to maintain certain insurance coverages, including remediation cost containment, premises pollution liability, and professional liability. The operative provisions of the Remediation Agreement were triggered on December 20, 2010, on which date Laclede Gas and the other former site owner, as full consideration under the Remediation Agreement, paid a small percentage of the cost of remediation of the site. The amount paid by Laclede Gas, which is its only monetary obligation under the Remediation Agreement, did not materially impact the financial condition, results of operations, or cash flows of the Company.

Laclede Gas has not owned the other site located in the City of St. Louis for many years. In a letter dated June 29, 2011, the Attorney General for the State of Missouri informed Laclede Gas that the Missouri Department of Natural Resources had completed an investigation of the site. The Attorney General requested that Laclede Gas participate in the follow up investigations of the site. In a letter dated January 10, 2012, the Company stated that it would participate in future environmental response activities at the site assuming that other potentially responsible parties are willing to contribute to such efforts in a meaningful and equitable fashion.

To date, amounts required for remediation at these sites have not been material. However, the amount of costs relative to future remedial actions at these and other sites is unknown and may be material. Laclede Gas has notified its insurers that it seeks reimbursement for costs incurred in the past and future potential liabilities associated with the MGP sites. While some of the insurers have denied coverage and reserved their rights, Laclede Gas continues to discuss potential reimbursements with them. In 2005, the Utility’s outside consultant completed an analysis of the MGP sites to determine cost estimates for a one-time contractual transfer of risk from each of the Utility’s insurers of environmental coverage for the MGP sites. That analysis demonstrated a range of possible future expenditures to investigate, monitor, and remediate these MGP sites from $5.8 million to $36.3 million based upon then currently available facts, technology, and laws and regulations. The actual costs that Laclede Gas may incur could be materially higher or lower depending upon several factors, including whether remedial actions will be required, final selection and regulatory approval of any remedial actions, changing technologies and governmental regulations, the ultimate ability of other potentially responsible parties to pay, the successful completion of remediation efforts required by the Remediation Agreement described above, and any insurance recoveries. Costs associated with environmental remediation activities are accrued when such costs are probable and reasonably estimable.

Laclede Gas anticipates that any costs it may incur in the future to remediate these sites, less any amounts received as insurance proceeds or as contributions from other potentially responsible parties, would be deferred and recovered in rates through periodic adjustments approved by the MoPSC. Accordingly, any potential liabilities that may arise with remediating these sites are not expected to have a material impact on the future financial position and results of operations of Laclede Gas or the Company.

On December 28, 2006, the MoPSC Staff proposed a disallowance of $7.2 million related to Laclede Gas’ recovery of its purchased gas costs applicable to fiscal year 2005, which the Staff later reduced to a $1.7 million disallowance pertaining to Laclede Gas’ purchase of gas from a marketing affiliate, LER. The MoPSC Staff has also proposed disallowances of $2.8 million and $1.5 million of gas costs relating to Laclede Gas purchases of gas supply from LER for fiscal years 2006 and 2007, respectively. The MoPSC Staff proposed a number of non-monetary recommendations, based on its review of gas costs for fiscal years 2008 and 2009. Laclede Gas believes that the proposed disallowances lack merit and is vigorously opposing these adjustments in proceedings before the MoPSC. As such, no amount has been recorded in the financial statements for these proposed disallowances.

In connection with the affiliate transactions mentioned above, on July 7, 2010, the MoPSC Staff filed a complaint against Laclede Gas alleging that, by stating that it was not in possession of proprietary LER documents, Laclede Gas violated the MoPSC Order authorizing the holding company structure (2001 Order). Laclede Gas counterclaimed that the Staff failed to adhere to the pricing provisions of the MoPSC’s affiliate transaction rules and Laclede Gas’ Cost Allocation Manual. By orders dated November 3, 2010 and February 4, 2011, respectively, the MoPSC dismissed Laclede’s counterclaim and granted summary judgment to Staff, finding that Laclede Gas violated the terms of the 2001 Order and authorizing its General Counsel to seek penalties in court against Laclede Gas. On March 30, 2011, Laclede Gas sought review of the February 4 Order with the Missouri Cole County Circuit Court. On May 19, 2011, the Commission’s General Counsel filed a petition with the Cole County Circuit Court seeking penalties in connection with the Commission’s February 4 Order. On July 7, 2011, the Circuit Court Judge signed an agreed Order holding the penalty case in abeyance while the February 4 Order is appealed. On December 21, 2011, the Circuit Court reversed both the MoPSC’s November 3, 2010 Order and its February 4, 2011 Order. The MoPSC appealed and the matter is currently before the Western District Court of Appeals.

Subsequent to the July 7, 2010 complaint, the MoPSC Staff filed a related complaint on October 6, 2010 against Laclede Gas, LER, and Laclede Group, alleging that the Utility has failed to comply with the MoPSC’s affiliate transaction rules. LER and Laclede Group both filed motions to be dismissed from the proceeding, which were granted by the Commission on December 22, 2010. On January 26, 2011, the Commission also dismissed certain counts of the complaint against Laclede Gas. The remaining counts and a counterclaim against the Staff, filed by Laclede Gas, are still pending before the Commission. Laclede Gas believes that the complaint lacks merit and is vigorously opposing it.

On June 29, 2010, the Office of Federal Contract Compliance Programs issued a Notice of Violations to Laclede Gas alleging lapses in certain employment selection procedures during a two-year period ending in February 2006. The Company believes that the allegations lack merit and is vigorously defending its position. Management, after discussion with counsel, believes that the final outcome of these matters will not have a material effect on the consolidated financial position and results of operations of the Company.

As discussed in Note 7, Derivative Instruments and Hedging Activities, Laclede Gas and LER enter into NYMEX and ICE exchange-traded/cleared derivative instruments. Previously, these instruments were held in accounts at MF Global, Inc. On October 31, 2011, affiliated entities of MF Global filed a Chapter 11 petition at the U.S. Bankruptcy Court in the Southern District of New York. Subsequently, the court-appointed bankruptcy trustee transferred all of the open positions and a significant portion of the margin deposits of Laclede Gas and LER to a new brokerage firm. As of April 26, 2012, Laclede Gas and LER had $1.5 million and $0.5 million, respectively, on deposit with MF Global in customer-segregated accounts that remain unavailable pending final resolution by the bankruptcy trustee. While the Company’s total exposure at this time is not considered material, management is unable to predict when, or to what extent, these remaining funds will be returned.

Laclede Group is involved in other litigation, claims, and investigations arising in the normal course of business. Management, after discussion with counsel, believes that the final outcome will not have a material effect on the consolidated financial position, results of operations, or cash flows of the Company.

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Document And Entity Information (USD $)	6 Months Ended
	Mar. 31, 2012	Apr. 26, 2012	Mar. 31, 2011
Entity Registrant Name	Laclede Group Inc.
Entity Central Index Key	0001126956
Current Fiscal Year End Date	--09-30
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 793,509,957
Entity Common Stock, Shares Outstanding		22,486,766
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2012

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SUBSEQUENT EVENT

6 Months Ended

Mar. 31, 2012

SUBSEQUENT EVENT

SUBSEQUENT EVENT

12. SUBSEQUENT EVENT

On April 27, 2012, Laclede Group announced a new organizational structure that will position the Company to grow through execution of four strategic imperatives: 1) develop and invest in emerging technologies, 2) pursue growth through the acquisition of businesses to which the Company can apply its operating model, 3) invest in infrastructure, and 4) leverage current business unit competencies to enhance growth. The Board of Directors approved the following appointments and promotions effective May 1, 2012:

. Michael R. Spotanski will be appointed to the newly created position of Senior Vice President, Chief Integration and Innovation Officer.  In his new role, Mr. Spotanski will lead the Company's efforts to integrate regulated natural gas distribution utilities and other businesses that the Company acquires as part of its growth strategy, as well as its efforts to develop and invest in emerging technologies.  Currently, Mr. Spotanski is Senior Vice President Operations and Marketing of Laclede Gas.  Until a new operating officer is appointed for Laclede Gas, Mr. Spotanski will continue to manage operations at Laclede Gas along with Suzanne Sitherwood who will remain President of Laclede Gas.

.	Mark C. Darrell will be appointed to the position of Senior Vice President, General Counsel and Chief Compliance Officer.  In this role, Mr. Darrell will supervise the Company's corporate legal functions, including mergers and acquisition support, litigation, regulatory affairs, contracts and environmental matters.  He will also be responsible for the Company's corporate compliance.
.	Mary C. Kullman will be promoted to Senior Vice President, Chief Administrative Officer and Corporate Secretary.  In her new role, Ms. Kullman's responsibilities will include overseeing corporate communications, marketing and branding; the development and implementation of standards for shared services, enterprise risk management and internal audit.  She will retain her current role as corporate secretary and responsibility for corporate governance, securities and ethics.
.	Steven P. Rasche will be promoted to Senior Vice President, Finance and Accounting of Laclede Group and appointed Chief Financial Officer of Laclede Gas.  He will also serve as principal accounting officer for the Company and Laclede Gas.  Mr. Rasche's responsibilities will include accounting, financial reporting and analysis, treasury, tax and investor relations.  Mr. Rasche will report to Mr. Waltermire.
.	Richard A. Skau will be appointed to Senior Vice President, Chief Human Resources Officer.  In this role, Mr. Skau will supervise the Company's efforts to attract, retain, develop and train employees to prepare them to execute on the Company's strategy.  His responsibilities also include employee relations, payroll, benefits, and diversity and inclusion.
.	Mark D. Waltermire will be promoted to Executive Vice President, Chief Financial Officer. In this role, Mr. Waltermire will oversee strategic planning and corporate development, information technology services, finance and accounting, supply chain functions and LER.

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CONSOLIDATED BALANCE SHEETS (UNAUDITED) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Sep. 30, 2011	Mar. 31, 2011
ASSETS
Utility Plant	$ 1,425,922	$ 1,386,590	$ 1,351,293
Less: Accumulated depreciation and amortization	468,209	457,907	453,271
Net Utility Plant	957,713	928,683	898,022
Non-utility property	4,448	4,588	4,418
Other investments	54,688	50,785	53,485
Other Property and Investments	59,136	55,373	57,903
Current Assets:
Cash and cash equivalents	9,302	43,277	22,982
Accounts receivable:
Utility	100,015	71,090	146,821
Non-utility	34,915	50,894	43,079
Other	18,666	12,572	7,505
Allowance for doubtful accounts	(8,758)	(10,073)	(11,095)
Delayed customer billings	13,464	0	32,398
Inventories:
Natural gas stored underground	57,456	115,170	40,225
Propane gas at FIFO cost	8,964	8,961	16,927
Materials and supplies at average cost	4,102	4,229	4,402
Natural gas receivable	16,351	30,689	18,183
Derivative instrument assets	5,297	7,759	10,491
Unamortized purchased gas adjustments	11,241	25,719	6,470
Deferred income taxes	0	0	7,310
Prepayments and other	6,795	8,847	5,437
Total Current Assets	277,810	369,134	351,135
Deferred Charges:
Regulatory assets	457,749	423,492	420,733
Other	5,723	6,400	6,624
Total Deferred Charges	463,472	429,892	427,357
Total Assets	1,758,131	1,783,082	1,734,417
Capitalization:
Common stock (70,000,000 shares authorized, 22,489,986, 22,430,734, and 22,400,309 shares issued, respectively)	22,490	22,431	22,400
Paid-in capital	165,056	163,702	160,152
Retained earnings	425,500	389,298	394,887
Accumulated other comprehensive income (loss)	2,158	(2,100)	(8,272)
Total Common Stock Equity	615,204	573,331	569,167
Long-term debt (less current portion) - Laclede Gas	339,386	364,357	364,327
Total Capitalization	954,590	937,688	933,494
Current Liabilities:
Notes payable	0	46,000	0
Accounts payable	73,045	96,561	96,808
Advance customer billings	0	15,230	0
Current portion of long-term debt	25,000	0	0
Wages and compensation accrued	13,873	13,650	13,504
Dividends payable	9,697	9,359	9,244
Customer deposits	9,459	10,048	10,719
Interest accrued	8,789	8,812	9,023
Taxes accrued	25,062	11,901	36,509
Deferred income taxes	6,615	8,405	0
Other	16,220	11,968	13,307
Total Current Liabilities	187,760	231,934	189,114
Deferred Credits and Other Liabilities:
Deferred income taxes	335,215	315,405	293,466
Unamortized investment tax credits	3,219	3,326	3,432
Pension and postretirement benefit costs	163,940	185,701	208,727
Asset retirement obligations	28,313	27,495	26,610
Regulatory liabilities	53,267	50,846	49,077
Other	31,827	30,687	30,497
Total Deferred Credits and Other Liabilities	615,781	613,460	611,809
Commitments and Contingencies (Note 11)
Total Capitalization and Liabilities	$ 1,758,131	$ 1,783,082	$ 1,734,417

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FAIR VALUE MEASUREMENTS

6 Months Ended

Mar. 31, 2012

Fair Value Measurements [Abstract]

FAIR VALUE MEASUREMENTS

6. 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 March 31, 2012
Assets
U. S. Stock/Bond Mutual Funds	$	17,907	$	—	$	—	$	—		$	17,907
NYMEX/ICE natural gas contracts		5,182		1,310		—		(4,881	)		1,611
NYMEX gasoline and heating
oil contracts		81		—		—		(81	)		—
Natural gas commodity contracts		—		4,362		79		(538	)		3,903
Total	$	23,170	$	5,672	$	79	$	(5,500	)	$	23,421
Liabilities
NYMEX/ICE natural gas contracts	$	37,811	$	2,342	$	—	$	(40,153	)	$	—
Natural gas commodity contracts		—		1,190		21		(538	)		673
Total	$	37,811	$	3,532	$	21	$	(40,691	)	$	673
As of September 30, 2011
Assets
U. S. Stock/Bond Mutual Funds	$	14,833	$	—	$	—	$	—		$	14,833
NYMEX/ICE natural gas contracts		4,856		—		—		1,975			6,831
NYMEX gasoline and heating
oil contracts		19		—		—		162			181
Natural gas commodity contracts		—		2,018		66		(108	)		1,976
Total	$	19,708	$	2,018	$	66	$	2,029		$	23,821
Liabilities
NYMEX/ICE natural gas contracts	$	20,928	$	—	$	—	$	(20,928	)	$	—
NYMEX gasoline and heating
oil contracts		124		—		—		(124	)		—
Natural gas commodity contracts		—		109		53		(108	)		54
Total	$	21,052	$	109	$	53	$	(21,160	)	$	54
As of March 31, 2011
Assets
U. S. Stock/Bond Mutual Funds	$	17,022	$	—	$	—	$	—		$	17,022
NYMEX/ICE natural gas contracts		5,718		—		—		4,416			10,134
NYMEX gasoline and heating
oil contracts		369		—		—		(38	)		331
Natural gas commodity contracts		—		930		57		(151	)		836
Total	$	23,109	$	930	$	57	$	4,227		$	28,323
Liabilities
NYMEX/ICE natural gas contracts	$	27,841	$	—	$	—	$	(27,841	)	$	—
Natural gas commodity contracts		—		313		33		(151	)		195
Total	$	27,841	$	313	$	33	$	(27,992	)	$	195

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						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Beginning of period	$	37		$	76		$	13		$	23
Settlements		(41	)		(81	)		(7	)		(52	)
Net losses related to derivatives not held   at end of period		(1	)		(5	)		(4	)		(16	)
Net gains related to derivatives still held   at end of period		63			34			56			69
End of period	$	58		$	24		$	58		$	24

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 7, Derivative Instruments and Hedging Activities.

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FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Mar. 31, 2012

Fair value of financial instruments [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

5. 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 (a)
(Thousands)	Carrying Amount		Fair Value		Quoted Prices in Active Markets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of March 31, 2012
Cash and cash equivalents	$	9,302	$	9,302	$	4,261	$	5,041	$	—
Short-term debt		—		—		—		—		—
Long-term debt, including current portion		364,386		432,098		—		432,098		—
As of September 30, 2011
Cash and cash equivalents	$	43,277	$	43,277
Short-term debt		46,000		46,000
Long-term debt		364,357		443,739
As of March 31, 2011
Cash and cash equivalents	$	22,982	$	22,982
Short-term debt		—		—
Long-term debt		364,327		391,877
(a) The Company adopted the provisions of ASU 2011-04 (ASC Topic 820) in the second quarter of fiscal year 2012 on a prospective basis. Accordingly, disclosures for prior periods are not required to be presented.

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 6, Fair Value Measurements, for information on financial instruments measured at fair value on a recurring basis.

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Mar. 31, 2012

Fair value of financial instruments [Abstract]

Fair value - 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 (a)
(Thousands)	Carrying Amount		Fair Value		Quoted Prices in Active Markets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of March 31, 2012
Cash and cash equivalents	$	9,302	$	9,302	$	4,261	$	5,041	$	-
Short-term debt		-		-		-		-		-
Long-term debt, including current portion		364,386		432,098		-		432,098		-
As of September 30, 2011
Cash and cash equivalents	$	43,277	$	43,277
Short-term debt		46,000		46,000
Long-term debt		364,357		443,739
As of March 31, 2011
Cash and cash equivalents	$	22,982	$	22,982
Short-term debt		-		-
Long-term debt		364,327		391,877
(a) The Company adopted the provisions of ASU 2011-04 (ASC Topic 820) in the second quarter of fiscal year 2012 on a prospective basis. Accordingly, disclosures for prior periods are not required to be presented.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Mar. 31, 2012

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract]

BASIS OF CONSOLIDATION

BASIS OF CONSOLIDATION - The consolidated financial statements include the accounts of Laclede Group and its subsidiary companies. All subsidiaries are wholly owned. Laclede Gas and other subsidiaries of Laclede Group may engage in related party transactions during the ordinary course of business. All material intercompany balances have been eliminated from the consolidated financial statements of Laclede Group. These transactions include sales of natural gas from Laclede Gas to LER, sales of natural gas from LER to Laclede Gas, and transportation services provided by Laclede Pipeline Company to Laclede Gas. These revenues are shown on the Intersegment revenues lines in the table included in Note 10 under Regulated Gas Distribution, Non-Regulated Gas Marketing, and Other columns, respectively.

NATURAL GAS STORED UNDERGROUND

NATURAL GAS STORED UNDERGROUND - Inventory of Utility natural gas in storage is priced on a last-in, first-out (LIFO) basis. The carrying value of Utility inventory is not adjusted to the lower of cost or market prices because, pursuant to the Laclede Gas Purchased Gas Adjustment (PGA) Clause, actual gas costs are recovered in customer rates. Natural gas storage inventory in the Non-Regulated Gas Marketing operating segment is recorded at the lower of average cost or market.

REVENUE RECOGNITION

REVENUE RECOGNITION - Laclede Gas reads meters and bills its customers on monthly cycles. The Utility records its regulated gas distribution 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 March 31, 2012 and 2011, for the Utility, were $13.0 million and $29.0 million, respectively. The amount of accrued unbilled revenue at September 30, 2011 was $11.8 million.

In the course of its business, LER 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, "Derivatives and Hedging." As such, those contracts are accounted for as executory contracts and recorded on an accrual basis. Revenues and expenses from such contracts are recorded using a gross presentation. Contracts not designated as normal purchases or normal sales are recorded as derivatives with changes in fair value (representing unrealized gains and losses) recognized in earnings the periods prior to physical delivery. For additional information on derivative instruments, refer to Note 7, Derivative Instruments and Hedging Activities. Certain of LER's wholesale purchase and sale transactions entered on or after January 1, 2012 are classified as trading activities for financial reporting purposes rather than elected for normal purchases or normal sales designations. Under generally accepted accounting principles (GAAP), revenues and expenses associated with trading activities are presented on a net basis in Non-Regulated Gas Marketing Operating Revenues in the Statements of Consolidated Income. This net presentation has no effect on operating income or net income.

GROSS RECEIPTS AND SALES TAXES

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 Regulated Gas Distribution Operating Revenues for the quarters ended March 31, 2012 and 2011 were $15.5 million and $20.3 million, respectively. Amounts recorded in Regulated Gas Distribution Operating Revenues for the six months ended March 31, 2012 and 2011 were $25.7 million and $31.6 million, respectively. Gross receipts taxes are expensed by the Utility and included in the Taxes, other than income taxes line.

NEW ACCOUNTING STANDARDS

NEW ACCOUNTING STANDARDS - In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-04, "Amendments to Achieve Common Fair Value Measurement Disclosure Requirements in U.S. GAAP and IFRSs." This ASU amends Accounting Standards Codification (ASC) Topic 820, "Fair Value Measurements and Disclosures," to improve the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and International Financial Reporting Standards (IFRS). The ASU does not change what items are measured at fair value, but instead makes various changes to the guidance pertaining to how fair value is measured. Additionally, the ASU sets forth additional disclosure requirements, including additional information about Level 3 fair value measurements. Many of the amendments in this ASU are changes to align the wording in U.S. GAAP with IFRS and, as such, are not intended to result in a change in the application of the guidance. The Company's adoption of the guidance in this ASU on a prospective basis in the second quarter of fiscal year 2012 had no impact on its financial condition or results of operations, but certain additional disclosures have been presented as required.

In June 2011, the FASB issued 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, will not impact total net income, comprehensive income, or earnings per share.

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.

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OTHER INCOME AND (INCOME DEDUCTIONS) - NET

6 Months Ended

Mar. 31, 2012

Other Income and (Income Deductions) -- Net [Abstract]

OTHER INCOME AND (INCOME DEDUCTIONS) - NET

9. OTHER INCOME AND (INCOME DEDUCTIONS) – NET

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012		2011
Interest income	$	316		$	267		$	664	$	715
Net investment gain		1,164			390			2,194		1,127
Other income		11			61			11		74
Other income deductions		(110	)		(251	)		451		396
Other Income and (Income Deductions) – Net	$	1,381		$	467		$	3,320	$	2,312

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6 Months Ended

Mar. 31, 2012

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES [Abstract]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

7. 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 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 March 31, 2012, Laclede Gas held 0.1 million gallons of gasoline futures contracts at an average price of $2.99 per gallon and 0.3 million gallons of gasoline options contracts. Most of these contracts, the longest of which extends to September 2012, 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.

In the course of its business, Laclede Group’s non-regulated gas marketing subsidiary, Laclede Energy Resources, Inc. (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 March 31, 2012, the fair values of 88.6 million MMBtu of non-exchange traded natural gas commodity contracts were reflected in the Consolidated Balance Sheet. Of these contracts, 64.9 million MMBtu will settle during fiscal year 2012, while the remaining 23.7 million MMBtu will settle during fiscal year 2013. 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 March 31, 2012, 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.

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 March 31, 2012, it is expected that approximately $6.4 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.

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 March 31, 2012 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 2012	—	$	—	3.92	$	3.01
Fiscal 2013	—		—	6.78		3.29
Open long futures positions
Fiscal 2012	9.49	$	4.22	1.63	$	3.89
Fiscal 2013	21.86		4.16	1.43		3.90
Fiscal 2014	0.80		3.51	0.10		4.34

At March 31, 2012, Laclede Gas and LER also had 11.8 million MMBtu and 4.1 million MMBtu, respectively, of other price mitigation in place through the use of NYMEX natural gas option-based strategies.

The Effect of Derivative Instruments on the Statements of Consolidated Income and Statements of Consolidated Comprehensive Income
		Three Months Ended						Six Months Ended
	Location of Gain (Loss)	March 31,						March 31,
(Thousands)	Recorded in Income		2012			2011			2012			2011
Derivatives in Cash Flow Hedging Relationships
Effective portion of gain recognized in OCI on derivatives:
NYMEX/ICE natural gas contracts		$	5,023		$	693		$	8,020		$	734
NYMEX gasoline and heating oil contracts			83			267			133			440
Total		$	5,106		$	960		$	8,153		$	1,174
Effective portion of gain (loss) reclassified from AOCI to income:
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues	$	4,048		$	757		$	10,788		$	5,591
	Non-Regulated Gas Marketing Operating Expenses		(4,445	)		(682	)		(8,369	)		(2,475	)
Sub-total			(397	)		75			2,419			3,116
NYMEX gasoline and heating oil contracts	Regulated Gas Distribution Other Operation Expenses		(11	)		72			3			121
Total		$	(408	)	$	147		$	2,422		$	3,237
Ineffective portion of gain (loss) on derivatives recognized in income:
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues	$	50		$	551		$	69		$	560
	Non-Regulated Gas Marketing Operating Expenses		(90	)		(498	)		(196	)		(623	)
Sub-total			(40	)		53			(127	)		(63	)
NYMEX gasoline and heating oil contracts	Regulated Gas Distribution Other Operation Expenses		28			19			34			48
Total		$	(12	)	$	72		$	(93	)	$	(15	)
Derivatives Not Designated as Hedging Instruments *
Gain (loss) recognized in income on derivatives:
Natural gas commodity contracts	Non-Regulated Gas Marketing Operating Revenues	$	1,557		$	143		$	790		$	(299	)
	Non-Regulated Gas Marketing Operating Expenses		—			746			687			1,196
NYMEX/ICE natural gas contracts	Non-Regulated Gas Marketing Operating Revenues		1,478			(42	)		1,548			(78	)
	Non-Regulated Gas Marketing Operating Expenses		30			—			30			—
NYMEX gasoline and heating oil contracts	Other Income and (Income Deductions) - Net		12			47			13			63
Total		$	3,077		$	894		$	3,068		$	882

* 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 Utility Natural and Propane Gas operating expenses when they are recovered through the PGA Clause and reflected in customer billings.

Fair Value of Derivative Instruments in the Consolidated Balance Sheet at March 31, 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	Derivative Instrument Assets	$	3,545		Derivative Instrument Assets	$	3,242
NYMEX gasoline and heating oil contracts	Accounts Receivable – Other		72		Accounts Receivable - Other		—
Sub-total			3,617				3,242
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Accounts Receivable - Other		709		Accounts Receivable - Other		36,437
	Derivative Instrument Assets		2,238		Derivative Instrument Assets		474
Natural gas commodity contracts	Derivative Instrument Assets		4,176		Derivative Instrument Assets		490
	Other Current Liabilities		48		Other Current Liabilities		721
	Other Deferred Charges		217		Other Deferred Charges		—
NYMEX gasoline and heating oil contracts	Accounts Receivable - Other		9		Accounts Receivable - Other		—
Sub-total			7,397				38,122
Total derivatives		$	11,014			$	41,364
Fair Value of Derivative Instruments in the Consolidated Balance Sheet at September 30, 2011
	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	$	4,395		Derivative Instrument Assets	$	4,105
	Other Deferred Charges		4		Other Deferred Charges		85
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		15		Derivative Instrument Assets		117
Sub-total			4,414				4,307
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Derivative Instrument Assets		457		Derivative Instrument Assets		16,330
	Other Deferred Charges		—		Other Deferred Charges		408
Natural gas commodity contracts	Derivative Instrument Assets		1,894		Derivative Instrument Assets		100
	Other Deferred Charges		183		Other Deferred Charges		—
	Other Current Liabilities		8		Other Current Liabilities		62
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		4		Derivative Instrument Assets		7
Sub-total			2,546				16,907
Total derivatives		$	6,960			$	21,214

Fair Value of Derivative Instruments in the Consolidated Balance Sheet at March 31, 2011
	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	$	688		Derivative Instrument Assets	$	10,926
	Other Deferred Charges		11		Other Deferred Charges		61
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		341		Derivative Instrument Assets		—
Sub-total			1,040				10,987
Derivatives not designated as hedging instruments
NYMEX/ICE natural gas contracts	Derivative Instrument Assets		4,353		Derivative Instrument Assets		16,854
	Other Deferred Charges		666		Other Deferred Charges		—
Natural gas commodity contracts	Derivative Instrument Assets		957		Derivative Instrument Assets		121
	Other Current Liabilities		30		Other Current Liabilities		225
NYMEX gasoline and heating oil contracts	Derivative Instrument Assets		28		Derivative Instrument Assets		—
Sub-total			6,034				17,200
Total derivatives		$	7,074			$	28,187

* The fair values of Asset Derivatives and Liability Derivatives exclude the fair value of cash margin receivables or payables with counterparties subject to netting arrangements. Fair value amounts of derivative contracts (including the fair value amounts of cash margin receivables and payables) for which there is a legal right to set off are presented net on the Consolidated Balance Sheets. As such, the gross balances presented in the table above are not indicative of the Company’s net economic exposure. Refer to Note 6, Fair Value Measurements, for information on the valuation of derivative instruments.

Following is a reconciliation of the amounts in the tables above to the amounts presented in the Consolidated Balance Sheets:

		March 31,			Sept. 30,			March 31,
	(Thousands)	2012			2011			2011
	Fair value of asset derivatives presented above	$	11,014		$	6,960		$	7,074
	Fair value of cash margin receivables offset with derivatives		35,648			23,188			32,258
	Netting of assets and liabilities with the same counterparty		(41,148	)		(21,160	)		(28,031	)
	Total	$	5,514		$	8,988		$	11,301
	Derivative Instrument Assets, per Consolidated Balance Sheets:
	Derivative instrument assets	$	5,297		$	7,759		$	10,491
	Other deferred charges		217			1,229			810
	Total	$	5,514		$	8,988		$	11,301
	Fair value of liability derivatives presented above	$	41,364		$	21,214		$	28,187
	Fair value of cash margin payables offset with derivatives		457			—			39
	Netting of assets and liabilities with the same counterparty		(41,148	)		(21,160	)		(28,031	)
	Derivative instrument liabilities, per Consolidated Balance Sheets*	$	673		$	54		$	195
*	Included in the Other line of the Current Liabilities section

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CONCENTRATIONS OF CREDIT RISK

6 Months Ended

Mar. 31, 2012

CONCENTRATIONS OF CREDIT RISK [Abstract]

CONCENTRATIONS OF CREDIT RISK

8. CONCENTRATIONS OF CREDIT RISK

A significant portion of LER’s transactions are with (or are associated with) energy producers, utility companies, and pipelines. These concentrations of transactions with these counterparties have the potential to affect the Company’s overall exposure to credit risk, either positively or negatively, in that each of these three groups may be affected similarly by changes in economic, industry, or other conditions. To manage this risk, as well as credit risk from significant counterparties in these and other industries, LER has established procedures to determine the creditworthiness of its counterparties. These procedures include obtaining credit ratings and credit reports, analyzing counterparty financial statements to assess financial condition, and considering the industry environment in which the counterparty operates. This information is monitored on an ongoing basis. In some instances, LER may require credit assurances such as prepayments, letters of credit, or parental guarantees. In addition, LER may enter into netting arrangements to mitigate credit risk with counterparties in the energy industry from which LER both sells and purchases natural gas. Sales are typically made on an unsecured credit basis with payment due the month following delivery. Accounts receivable amounts are closely monitored and provisions for uncollectible amounts are accrued when losses are probable. To date, losses have not been significant. LER records accounts receivable, accounts payable, and prepayments for physical sales and purchases of natural gas on a gross basis. The amount included in accounts receivable attributable to energy producers and their marketing affiliates amounted to $10.5 million at March 31, 2012. Net receivable amounts from these customers on the same date, reflecting netting arrangements, were $7.8 million. Accounts receivable attributable to utility companies and their marketing affiliates comprised $12.6 million of total accounts receivable at March 31, 2012, while net receivable amounts from these customers, reflecting netting arrangements, were $11.9 million. LER also has concentrations of credit risk with certain individually significant counterparties. At March 31, 2012, the amounts included in accounts receivable from LER’s five largest counterparties (in terms of net accounts receivable exposure), were $13.4 million. These five counterparties are either investment-grade rated or owned by investment-grade rated companies. Net receivable amounts from these customers on the same date, reflecting netting arrangements, were $11.4 million. Additionally, LER has concentrations of credit risk with pipeline companies associated with its natural gas receivable amounts.

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INFORMATION BY OPERATING SEGMENT

6 Months Ended

Mar. 31, 2012

INFORMATION BY OPERATING SEGMENT [Abstract]

INFORMATION BY OPERATING SEGMENT

10. INFORMATION BY OPERATING SEGMENT

All of Laclede Group’s subsidiaries are wholly owned. The Regulated Gas Distribution segment consists of the regulated operations of Laclede Gas and is the core business segment of Laclede Group. Laclede Gas is a public utility engaged in the retail distribution and sale of natural gas serving an area in eastern Missouri, with a population of approximately 2.2 million, including the City of St. Louis and parts of ten counties in eastern Missouri. The Non-Regulated Gas Marketing segment includes the results of LER, a subsidiary engaged in the non-regulated marketing of natural gas and related activities, and LER Storage Services, Inc., which was formed in October 2011 to utilize natural gas storage contracts for providing natural gas sales. Other includes Laclede Pipeline Company’s transportation of liquid propane regulated by the Federal Energy Regulatory Commission (FERC) as well as non-regulated activities, including real estate development, the compression of natural gas, and financial investments in other enterprises. These operations are conducted through five subsidiaries. Other also includes Laclede Gas’ non-regulated business activities, which are comprised of its non-regulated propane sales transactions and its propane storage and related services. Accounting policies are described in Note 1. Intersegment transactions include sales of natural gas from Laclede Gas to LER, sales of natural gas from LER to Laclede Gas, and transportation services provided by Laclede Pipeline Company to Laclede Gas. These revenues are shown on the Intersegment revenues lines in the table under Regulated Gas Distribution, Non-Regulated Gas Marketing, and Other columns, respectively.

Management evaluates the performance of the operating segments based on the computation of net economic earnings. Net economic earnings exclude from reported net income the after-tax impacts of net unrealized gains and losses and other timing differences associated with energy-related transactions. Net economic earnings will also exclude, if applicable, the after-tax impact of costs related to acquisition, divestiture, and restructuring activities.

			Non-
	Regulated		Regulated
	Gas		Gas
(Thousands)	Distribution		Marketing		Other			Eliminations			Consolidated
Three Months Ended
March 31, 2012
Revenues from external customers	$	298,623	$	66,045	$	381		$	—		$	365,049
Intersegment revenues		—		1,927		259			(9,060	)		(6,874	)
Total Operating Revenues		298,623		67,972		640			(9,060	)		358,175
Net Economic Earnings		25,772		2,545		110			—			28,427
Total assets		1,680,948		177,129		151,646			(251,592	)		1,758,131
Six Months Ended
March 31, 2012
Revenues from external customers	$	549,522	$	218,022	$	1,544		$	—		$	769,088
Intersegment revenues		3		8,538		519			(9,060	)		—
Total Operating Revenues		549,525		226,560		2,063			(9,060	)		769,088
Net Economic Earnings		46,851		5,984		485			—			53,320
Total assets		1,680,948		177,129		151,646			(251,592	)		1,758,131
Three Months Ended
March 31, 2011
Revenues from external customers	$	387,737	$	151,305	$	33		$	—		$	539,075
Intersegment revenues		638		3,806		259			—			4,703
Total Operating Revenues		388,375		155,111		292			—			543,778
Net Economic Earnings (Losses)		26,203		1,335		(76	)		—			27,462
Total assets		1,634,674		165,403		130,172			(195,832	)		1,734,417
Six Months Ended
March 31, 2011
Revenues from external customers	$	664,242	$	309,006	$	124		$	—		$	973,372
Intersegment revenues		1,576		12,513		519			—			14,608
Total Operating Revenues		665,818		321,519		643			—			987,980
Net Economic Earnings (Losses)		47,637		3,281		(68	)		—			50,850
Total assets		1,634,674		165,403		130,172			(195,832	)		1,734,417

Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income
	Three Months Ended					Six Months Ended
	March 31,					March 31,
(Thousands)	2012			2011		2012			2011
Total Net Economic Earnings above	$	28,427		$	27,462	$	53,320		$	50,850
Add: Unrealized gain on energy-related
derivative contracts, net of tax		1,963			431		2,244			412
Add:  Lower of cost or market inventory
adjustments, net of tax		(562	)		—		(562	)		—
Add:  Realized loss on economic hedges prior
to sale of the physical commodity, net of tax		(144	)		—		(144	)		—
Net Income	$	29,684		$	27,893	$	54,858		$	51,262

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Sep. 30, 2011	Mar. 31, 2011	Sep. 30, 2010
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	$ 9,302	$ 43,277	$ 22,982	$ 86,919
Short-term debt	0	46,000	0
Carrying (Reported) Amount, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	9,302	43,277	22,982
Short-term debt	0	46,000	0
Long-term debt, including current portion	364,386	364,357	364,327
Estimate of Fair Value, Fair Value Disclosure [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	9,302	43,277	22,982
Short-term debt	0	46,000	0
Long-term debt, including current portion	432,098	443,739	391,877
Quoted Prices in Active Markets (Level 1) [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	4,261
Short-term debt	0
Long-term debt, including current portion	0
Significant Observable Inputs (Level 2) [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	5,041
Short-term debt	0
Long-term debt, including current portion	432,098
Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	0
Short-term debt	0
Long-term debt, including current portion	$ 0

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STOCK-BASED COMPENSATION (Tables)

6 Months Ended

Mar. 31, 2012

Stock-Based Compensation [Abstract]

Performance-contingent restricted stock and performance -contingent stock unit activity

Activity of restricted stock and restricted stock units subject to performance and/or market conditions during the six months ended March 31, 2012 is presented below:

			Weighted
			Average
	Shares/		Grant Date
	Units		Fair Value
Nonvested at September 30, 2011	259,075			$	34.29
Granted (maximum shares that can be earned)	101,963			$	36.55
Vested	(48,429	)		$	48.70
Forfeited	(79,072	)		$	38.43
Nonvested at March 31, 2012	233,537			$	30.88

Time-vested restricted stock and time-vested restricted stock unit activity for the six months ended March 31, 2012 is presented below:

			Weighted
			Average
	Shares/		Grant Date
	Units		Fair Value
Nonvested at September 30, 2011	143,350			$	37.00
Granted	43,775			$	40.23
Vested	(54,400	)		$	41.48
Forfeited	(12,700	)		$	33.53
Nonvested at March 31, 2012	120,025			$	36.51

Stock option awards activity

Stock option activity for the six months ended March 31, 2012 is presented below:

					Weighted
					Average
			Weighted		Remaining	Aggregate
			Average		Contractual	Intrinsic
	Stock		Exercise		Term	Value
	Options		Price		(Years)	($000)
Outstanding at September 30, 2011	305,875		$	30.72
Granted	-		$	-
Exercised	(43,625	)	$	30.63
Forfeited	-		$	-
Expired	-		$	-
Outstanding at March 31, 2012	262,250		$	30.74	2.8	$	2,172
Fully Vested and Expected to Vest   at March 31, 2012	262,250		$	30.74	2.8	$	2,172
Exercisable at March 31, 2012	262,250		$	30.74	2.8	$	2,172

Compensation cost recognized for share-based compensation arrangements

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

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Total equity compensation cost	$	684		$	822		$	1,351		$	1,540
Compensation cost capitalized		(221	)		(177	)		(359	)		(331	)
Compensation cost recognized in net income		463			645			992			1,209
Income tax benefit recognized in net income		(179	)		(248	)		(383	)		(466	)
Compensation cost recognized in net income,
net of income tax	$	284		$	397		$	609		$	743

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OTHER INCOME AND (INCOME DEDUCTIONS) - NET (Tables)

6 Months Ended

Mar. 31, 2012

Other Income and (Income Deductions) -- Net [Abstract]

Other Income and (Income Deductions) by Component

Three Months Ended					Six Months Ended
		March 31,						March 31,
	(Thousands)	2012			2011			2012		2011
	Interest income	$	316		$	267		$	664	$	715
	Net investment gain		1,164			390			2,194		1,127
	Other income		11			61			11		74
	Other income deductions		(110	)		(251	)		451		396
	Other Income and (Income Deductions) - Net	$	1,381		$	467		$	3,320	$	2,312

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CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical)	Mar. 31, 2012	Sep. 30, 2011	Mar. 31, 2011
Balance Sheet [Abstract]
Common Stock Shares Issues (in shares)	22,489,986	22,430,734	22,400,309
Common Stock Shares Authorized (in shares)	70,000,000	70,000,000	70,000,000

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EARNINGS PER COMMON SHARE

6 Months Ended

Mar. 31, 2012

EARNINGS PER COMMON SHARE [Abstract]

EARNINGS PER COMMON SHARE

4. EARNINGS PER COMMON SHARE

	Three Months Ended				Six Months Ended
	March 31,				March 31,
(Thousands, Except Per Share Amounts)		2012		2011		2012		2011
Basic EPS:
Net Income	$	29,684	$	27,893	$	54,858	$	51,262
Less: Income allocated to participating securities		167		226		324		430
Net Income Available to Common Shareholders	$	29,517	$	27,667	$	54,534	$	50,832
Weighted Average Shares Outstanding		22,254		22,100		22,223		22,070
Earnings Per Share of Common Stock	$	1.33	$	1.25	$	2.45	$	2.30
Diluted EPS:
Net Income	$	29,684	$	27,893	$	54,858	$	51,262
Less: Income allocated to participating securities		166		226		323		429
Net Income Available to Common Shareholders	$	29,518	$	27,667	$	54,535	$	50,833
Weighted Average Shares Outstanding		22,254		22,100		22,223		22,070
Dilutive Effect of Stock Options
and Restricted Stock		82		72		76		75
Weighted Average Diluted Shares		22,336		22,172		22,299		22,145
Earnings Per Share of Common Stock	$	1.32	$	1.25	$	2.45	$	2.30
Outstanding Shares Excluded from the
Calculation of Diluted EPS Attributable to:
Restricted stock and stock units subject to
performance and/or market conditions		203		193		203		193

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INFORMATION BY OPERATING SEGMENT (Tables)

6 Months Ended

Mar. 31, 2012

INFORMATION BY OPERATING SEGMENT [Abstract]

Schedule of operating segment information

	Non-
	Regulated		Regulated
	Gas		Gas
(Thousands)	Distribution		Marketing		Other			Eliminations			Consolidated
Three Months Ended
March 31, 2012
Revenues from external customers	$	298,623	$	66,045	$	381		$	-		$	365,049
Intersegment revenues		-		1,927		259			(9,060	)		(6,874	)
Total Operating Revenues		298,623		67,972		640			(9,060	)		358,175
Net Economic Earnings		25,772		2,545		110			-			28,427
Total assets		1,680,948		177,129		151,646			(251,592	)		1,758,131
Six Months Ended
March 31, 2012
Revenues from external customers	$	549,522	$	218,022	$	1,544		$	-		$	769,088
Intersegment revenues		3		8,538		519			(9,060	)		-
Total Operating Revenues		549,525		226,560		2,063			(9,060	)		769,088
Net Economic Earnings		46,851		5,984		485			-			53,320
Total assets		1,680,948		177,129		151,646			(251,592	)		1,758,131
Three Months Ended
March 31, 2011
Revenues from external customers	$	387,737	$	151,305	$	33		$	-		$	539,075
Intersegment revenues		638		3,806		259			-			4,703
Total Operating Revenues		388,375		155,111		292			-			543,778
Net Economic Earnings (Losses)		26,203		1,335		(76	)		-			27,462
Total assets		1,634,674		165,403		130,172			(195,832	)		1,734,417
Six Months Ended
March 31, 2011
Revenues from external customers	$	664,242	$	309,006	$	124		$	-		$	973,372
Intersegment revenues		1,576		12,513		519			-			14,608
Total Operating Revenues		665,818		321,519		643			-			987,980
Net Economic Earnings (Losses)		47,637		3,281		(68	)		-			50,850
Total assets		1,634,674		165,403		130,172			(195,832	)		1,734,417

Schedule of the reconciliation of consolidated net economic earnings to consolidated net income

Reconciliation of Consolidated Net Economic Earnings to Consolidated Net Income
		Three Months Ended					Six Months Ended
		March 31,					March 31,
	(Thousands)	2012			2011		2012			2011
	Total Net Economic Earnings above	$	28,427		$	27,462	$	53,320		$	50,850
	Add: Unrealized gain on energy-related
	derivative contracts, net of tax		1,963			431		2,244			412
	Add:  Lower of cost or market inventory
	adjustments, net of tax		(562	)		-		(562	)		-
	Add:  Realized loss on economic hedges prior
	to sale of the physical commodity, net of tax		(144	)		-		(144	)		-
	Net Income	$	29,684		$	27,893	$	54,858		$	51,262

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OTHER INCOME AND (INCOME DEDUCTIONS) - NET (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012	Mar. 31, 2011
Other Income and (Income Deductions) -- Net [Abstract]
Interest income	$ 316	$ 267	$ 664	$ 715
Net investment gain	1,164	390	2,194	1,127
Other income	11	61	11	74
Other income deductions	(110)	(251)	451	396
Other Income and (Income Deductions) - Net	$ 1,381	$ 467	$ 3,320	$ 2,312

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PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS (Tables)

6 Months Ended

Mar. 31, 2012

Pension Plans and Other Postretirement Benefits [Abstract]

Net Periodic Cost

The net periodic pension costs include the following components:

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Service cost - benefits earned during the period	$	2,301		$	2,388		$	4,613		$	4,776
Interest cost on projected benefit obligation		4,840			4,705			9,711			9,410
Expected return on plan assets		(4,899	)		(4,712	)		(9,798	)		(9,424	)
Amortization of prior service cost		148			160			296			320
Amortization of actuarial loss		2,259			2,557			4,536			5,114
Loss on lump-sum settlement		3,407			-			3,407			-
Sub-total		8,056			5,098			12,765			10,196
Regulatory adjustment		(484	)		(862	)		(967	)		(4,395	)
Net pension cost	$	7,572		$	4,236		$	11,798		$	5,801

Net periodic postretirement benefit costs consisted of the following components:

	Three Months Ended						Six Months Ended
	March 31,						March 31,
(Thousands)	2012			2011			2012			2011
Service cost - benefits earned during the period	$	2,015		$	1,919		$	4,030		$	3,838
Interest cost on accumulated
postretirement benefit obligation		1,380			1,211			2,760			2,422
Expected return on plan assets		(991	)		(912	)		(1,982	)		(1,823	)
Amortization of transition obligation		34			34			68			68
Amortization of prior service credit		(518	)		(582	)		(1,036	)		(1,164	)
Amortization of actuarial loss		1,065			1,111			2,130			2,221
Sub-total		2,985			2,781			5,970			5,562
Regulatory adjustment		(604	)		(400	)		(1,208	)		(1,271	)
Net postretirement benefit cost	$	2,381		$	2,381		$	4,762		$	4,291