The Laclede Group Reports Increased Earnings and Gain on Sale of Subsidiary

Dividends Declared

ST. LOUIS, April 24 /PRNewswire-FirstCall/ -- The Laclede Group, Inc. (NYSE:LG) released earnings for the second quarter of its fiscal year today and declared a quarterly dividend of 37 1/2 cents per share on its common stock, payable July 1, 2008 to shareholders of record on June 11, 2008.

* Diluted earnings per share increased to $2.37 from $.97 for same quarter last year. Earnings results for the quarter were bolstered by a one-time gain realized on the sale of Laclede Group's wholly-owned non-regulated subsidiary, SM&P Utility Resources, Inc. (SM&P), an underground facility locating and marking service business headquartered in Carmel, Indiana. The results also demonstrated solid year-over-year growth for Laclede Group's continuing operations, which consist of all of Laclede Group's subsidiaries excluding SM&P. Consolidated net income for the quarter ended March 31, 2008, was $51.4 million compared with $20.8 million for the quarter ended March 31, 2007. Diluted earnings per share were $2.37 for the second quarter this year compared to $.97 per share for the same quarter last year, with $1.19 of this year's diluted per share earnings being attributable to the sale of SM&P.

Consolidated income from continuing operations for the quarter ended March 31, 2008, was $30.1 million, compared with $24.0 million for the same period last year. Diluted earnings per share from continuing operations were $1.39 for the second quarter compared to $1.12 per share for the quarter ended March 31, 2007.

* Sale of SM&P nets $25.8 million. The Laclede Group closed on the sale of 100% of its interest in SM&P on March 31, 2008. The sale resulted in an after-tax net gain of $25.8 million, subject a minor post-closing adjustment, the amount of which is yet to be determined.

Income from discontinued operations for the quarter ended March 31, 2008 was $21.3 million, including the net effect of the sale and SM&P's seasonal operating loss for the quarter, compared to a loss from SM&P's operations totaling $3.2 million for the same period last year.

* Laclede Gas posted significantly improved results. Quarterly earnings reported by Laclede Group's core subsidiary, Laclede Gas Company, Missouri's largest natural gas distribution utility, were $25.3 million, up $4.6 million compared to the same quarter last year. The improved results reflect the general rate increase that became effective August 1, 2007 and the benefit of a reversal of tax-related expenses. The results were downwardly impacted by a change in the sharing mechanism for off-system sales and capacity release revenues and an increase in bad debt expense.

* Laclede Energy Resources earned $1.5 million more than same quarter last year. Laclede Energy Resources, Inc. (LER), Laclede Group's non-regulated natural gas commodity service provider, reported earnings totaling $4.9 million for the quarter, which were $1.5 million more than the same period last year. The increase in earnings was primarily due to the benefit of a reversal of tax-related expenses and increased sales volumes, partially offset by decreased margins on sales of natural gas during the quarter.

* Diluted earnings per share for six months ended March 31, 2008, increased to $3.34 from $1.86 for same period last year. Laclede Group's consolidated net income for the six-month period ended March 31, 2008 was $72.3 million, compared to $39.9 million for the same period last year. Diluted earnings per share for the six-month period were $3.34 compared to $1.86 per share reported for the same period last year.

Consolidated income from continuing operations was $51.6 million for the six-month period ended March 31, 2008 compared to $43.4 million for the same period last year. Diluted earnings per share from continuing operations were $2.38 compared to $2.02 per share for the same period last year. Laclede Gas reported increased net income primarily due to the same factors as discussed above. LER also reported higher year-over-year income primarily due to increased margins on sales of natural gas, in addition to the aforementioned factors.

Income from discontinued operations was $20.7 million for the six-month period ended March 31, 2008, including the net effect of the aforementioned sale and SM&P's operating loss for the period. The loss from SM&P's operations was $3.5 million for the same period last year.

The Laclede Group's earnings are seasonal in nature and generally correspond with the heating season for Laclede Gas Company, its largest subsidiary.

* Laclede Gas declared quarterly preferred stock dividends. Laclede Gas Company declared a quarterly dividend of 31 1/4 cents per share on Preferred Stock, Series B, and a quarterly dividend of 28 1/2 cents per share on Preferred Stock, Series C, payable June 30, 2008 to shareholders of record June 11, 2008.

For further details concerning The Laclede Group's fiscal 2008 second quarter results, see the accompanying unaudited Statements of Consolidated Income.

The Laclede Group, Inc. is a public utility holding company committed to providing reliable natural gas service through its regulated core utility operations, while engaging in non-regulated activities that provide opportunities for sustainable growth. Its primary subsidiary -- Laclede Gas Company, the regulated operations of which are included in the Regulated Gas Distribution segment, serves approximately 632,000 residential, commercial and industrial customers in the city of St. Louis and ten other counties in Eastern Missouri. Its primary non-regulated business is Laclede Energy Resources, Inc., a natural gas commodity service provider located in St. Louis Missouri, which is included in the Non-Regulated Gas Marketing segment. For more information about Laclede Group and its subsidiaries, visit http://www.thelacledegroup.com/.

Note: This news release contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended. The Company's future operating results may be affected by
various uncertainties and risk factors, many of which are beyond the
Company's control, including weather conditions, governmental and
regulatory policy and action, the competitive environment and economic
factors. For a more complete description of these uncertainties and risk
factors, see the Company's Form 10-Q for the quarter ended December 31,
2007, filed with the Securities and Exchange Commission.

UNAUDITED

STATEMENTS OF CONSOLIDATED INCOME

THE LACLEDE GROUP, INC.
(Thousands, Except Per Share Amounts)

Three Months Ended Six Months Ended
March 31, March 31,
2008 2007 2008 2007
OPERATING REVENUES
Regulated Gas
Distribution $507,089 $493,593 $827,981 $842,081
Non-Regulated Gas
Marketing 239,387 175,850 421,185 329,317
Other 1,230 1,257 2,530 2,434
Total Operating
Revenues 747,706 670,700 1,251,696 1,173,832

OPERATING EXPENSES
Regulated
Natural and propane
gas 377,526 373,576 600,367 625,099
Other operation
expenses 38,989 36,816 74,202 70,496
Maintenance 5,814 6,060 12,049 11,658
Depreciation and
amortization 8,763 8,568 17,476 17,065
Taxes, other than
income taxes 29,255 28,348 45,936 47,107
Total Regulated
Operating
Expenses 460,347 453,368 750,030 771,425
Non-Regulated Gas
Marketing 234,021 170,881 406,893 318,549
Other 1,455 1,434 2,713 2,809
Total Operating
Expenses 695,823 625,683 1,159,636 1,092,783

Operating Income 51,883 45,017 92,060 81,049
Other Income and
(Income Deductions) - Net 1,076 1,074 3,725 4,376
Interest Charges:
Interest on long-term
debt 4,875 5,625 10,001 11,251
Interest on long-term
debt to unconsolidated
affiliate trust 70 70 139 139
Other interest charges 2,056 2,939 6,219 6,373
Total Interest
Charges 7,001 8,634 16,359 17,763

Income from Continuing
Operations Before Income
Taxes and Dividends on
Laclede Gas Redeemable
Preferred Stock 45,958 37,457 79,426 67,662
Income Tax Expense 15,889 13,437 27,811 24,222
Dividends on Laclede Gas
Redeemable Preferred
Stock 9 11 19 23
Income from Continuing
Operations 30,060 24,009 51,596 43,417
Income (Loss) from
Discontinued Operations,
Net of Income Tax 21,294 (3,190) 20,661 (3,511)
Net Income $51,354 $20,819 $72,257 $39,906

Average Number of Common
Shares Outstanding 21,589 21,445 21,571 21,413
Basic Earnings Per Share
of Common Stock:
Income from Continuing
Operations $1.39 $1.12 $2.39 $2.03

Income (Loss) from
Discontinued Operations 0.99 (0.15) 0.96 (0.17)
Net Income $2.38 $0.97 $3.35 $1.86

Diluted Earnings Per Share
of Common Stock:
Income from Continuing
Operations $1.39 $1.12 $2.38 $2.02

Income (Loss) from
Discontinued Operations 0.98 (0.15) 0.96 (0.16)
Net Income $2.37 $0.97 $3.34 $1.86

Certain prior-period amounts have been reclassified to conform to current-year presentation.

First Call Analyst:
FCMN Contact:

Source: The Laclede Group, Inc.

CONTACT: George Csolak of The Laclede Group, Inc., +1-314-342-0652

Web site: http://www.thelacledegroup.com/

2008-04-24 18:24:55 0345042 PRNEWSWIRE