6. Discontinued Operations

12 Months Ended

Sep. 30, 2011

Discontinued Operations Abstract

6. Discontinued Operations

6. Discontinued Operations

On May 12, 2011, we entered into a definitive agreement to sell all of our natural gas distribution assets located in Missouri, Illinois and Iowa to Liberty Energy (Midstates) Corporation, an affiliate of Algonquin Power & Utilities Corp. for a cash price of approximately $124 million. The agreement contains terms and conditions customary for transactions of this type, including typical adjustments to the purchase price at closing, if applicable. The closing of the transaction is subject to the satisfaction of customary conditions including the receipt of applicable regulatory approvals.

As required under generally accepted accounting principles, the operating results of our Missouri, Illinois and Iowa operations have been aggregated and reported on the consolidated statements of income as income from discontinued operations, net of income tax. Expenses related to general corporate overhead and interest expense allocated to their operations are not included in discontinued operations.

The tables below set forth selected financial and operational information related to net assets and operating results related to discontinued operations. Additionally, assets and liabilities related to our Missouri, Illinois and Iowa operations are classified as “held for sale” in other current assets and liabilities in our consolidated balance sheets at September 30, 2011. Prior period revenues and expenses associated with these assets have been reclassified into discontinued operations. This reclassification had no impact on previously reported net income.

The following table presents statement of income data related to discontinued operations.
			Year Ended
			September 30
			2011		2010		2009
			(In thousands)
Operating revenues			$	80,028	$	69,855	$	99,969
Purchased gas cost				48,759		42,419		72,945
	Gross profit			31,269		27,436		27,024
Operating expenses				16,854		15,151		15,988
Operating income				14,415		12,285		11,036
Other nonoperating expense				(196)		(294)		(428)
Income from discontinued operations
	before income taxes			14,219		11,991		10,608
Income tax expense				5,502		4,425		2,929
		Net income	$	8,717	$	7,566	$	7,679

The following table presents balance sheet data related to assets held for sale.
		September 30,
		2011
		(In thousands)
Net plant, property & equipment		$	127,577
Gas stored underground			11,931
Other current assets			786
Deferred charges and other assets			277
	Assets held for sale	$	140,571
Accounts payable and accrued liabilities		$	1,917
Other current liabilities			4,877
Regulatory cost of removal			10,498
Deferred credits and other liabilities			1,153
	Liabilities held for sale	$	18,445