Spire Inc. · NYSE:SR
Spire — Laclede Group — Midwest Utilities Seminar (April 2008)
38 slides from Spire's conference presentation, Apr 9, 2008
Slide 1: The Laclede Group
The Laclede Group Midwest Utilities Seminar April 9, 2008
Slide 2: Forward-looking statements
This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Future operating results may be affected by various uncertainties and risk factors, many of which are beyond the control of The Laclede Group, Inc, including we
Slide 3: Company Overview
Company Overview • Public Utility Holding Company Formed 2001 • Strong Utility Platform • Growth Components Complementary to Core • Demonstrated Strategic Success • S&P Small Cap 600 Company
Slide 4: Strategic Execution
Strategic Execution • Five Consecutive Years of Record Earnings – Acquisition and organic growth • Utility Operations – Strong rate case results – Stability of earnings – Operational improvements • Non-Utility Components – Logical extension of core utility business – Continued growth of Laclede Ener
Slide 5: Accessible Liquidity
Accessible Liquidity ¢ Strong Credit Ratings S&P Moody’s Fitch Laclede Group Laclede Gas A A A3 A- At * Continued Access to Capital Markets ¢ Short-Term Liquidity — Commercial Paper at favorable rates backed by Lines of Credit Te Laclede Group
Slide 6: Laclede Gas
Laclede Gas
Slide 7: Years of Service
150 Years of Service • Established as The Laclede Gas Light Company in 1857 • Original Dow Jones index company • Largest LDC in Missouri
Slide 8: Our System & Strengths
Our System & Strengths • 630,000+ Customers (83% Market Saturation) • Over 16,000 Miles of Pipe • Diversified Gas Supply • Significant Storage Capacity – Market area: 5 Bcf natural gas, 3 Bcfe liquid propane – Upstream system: 23 Bcf
Slide 9: Upstream Pipeline Transportation Network
Upstream Pipeline Transportation Network
Slide 10: Hedging Program
Hedging Program • Minimizes Gas Price Volatility – Hedging only – No speculation • Covers Up to 70 Percent of Normal Purchases • Disciplined Approach – Price and time driven hedging components – NYMEX futures and options • Gains, Losses, and Expenses Included in PGA
Slide 11: Regulation
Regulation • Missouri Public Service Commission • Constructive Outcomes – August 2007: $38.6 MM increase in non-gas revenues – Enhanced Rate Design – Infrastructure System Replacement Surcharge (ISRS) – Reduced reliance on off-system sales – Enhanced Gas Supply Incentive Program (GSIP)
Slide 12: Enhanced Rate Design
Enhanced Rate Design • Traditional Rate Design – Lower monthly customer charge – Recovery through volumetric rate – Exposure to weather and customer conservation • Laclede Design (Effective November 2002) – Margin recovery through first rate block • Enhanced Laclede Design (Effective August 2007) –
Slide 13: ISRS
ISRS • Infrastructure System Replacement Surcharge (ISRS) • Enacted in 2003 • Allows Recovery Between Rate Cases of Facility-Related Expenditures – Compliance with state and federal safety requirements • Recovers Depreciation, Property Taxes, and Rate of Return • Reset After Each Rate Case – $1.6 MM
Slide 14: Advocacy
Advocacy • Missouri Energy Development Association – Missouri investor-owned natural gas, electric, and water utilities • Advocates measures to support utility infrastructure and services to benefit Missouri citizens and businesses – Current Chairman: Douglas H. Yaeger – Legislative achievements • I
Slide 15: Operational and Customer Focus
Operational and Customer Focus Field Technology Bill Redesign Automated Meter Reading GIS System Green Building Initiatives
Slide 16: Laclede
Laclede
Slide 17: Laclede Energy Resources
Laclede Energy Resources • Non-regulated Natural Gas Marketer – Large retail and wholesale customer base – Organically grown – Flexible pricing alternatives – Risk management utilizing financial markets • Lock in margins • No speculation – Experienced Management
Slide 18: Laclede Energy Resources
Laclede Energy Resources • Strong Performance During 2007 – 30% increase in sales volumes – Volumes delivered similar to Laclede Gas Company (107 Bcf vs. 112 Bcf) • Growth in Overall Portfolio – Additional transportation capacity and gas supplies – Increased number of counterparties • Growth in Sale
Slide 19: Current LER Footprint
75% of Business Activity 99% of Business Activity Current LER Footprint
Slide 20: Drivers of Growth
Drivers of Growth • Pipeline Expansion Projects – New marketing opportunities • Storage Expansion • New Gas Supply Basins – Shale plays • Producer Services • Additional Markets – Power generation – Ethanol business growing in the Midwest – LDCs
Slide 21: Rocky Mts, LNG, Canadian Gas
Rocky Mts LNG LNG Canadian Gas Reduction
Slide 22: Response to Supply and Demand Conditions
Response to Supply and Demand Conditions
Slide 23: Slide 23
Slide 24: Laclede Pipeline Company
Laclede Pipeline Company • Uniquely Situated LPG Pipeline – Market crossroads location – Only U.S. interstate LPG pipeline with LDC customer Laclede Pipeline Company
Slide 25: LPG Pipeline Assets
LPG Pipeline Assets • March 2006: LPC Filed an Application with FERC – Provides common carrier LPG transportation in interstate commerce – Allows propane and butane shipments by third parties – Preserves historic role re: Laclede Gas Company peaking needs • LPC’s FERC Tariff Effective April 1, 2006
Slide 26: SM&P Utility Resources
oM)P Mis » | RESOURCES, INC, Our mark is our ae Period.
Slide 27: SM&P Utility Resources
SM&P Utility Resources • Underground Locating and Marking Company - Acquired in January 2002 – Grew business – Strengthened core management – Developed technological competencies – Built on industry leadership to provide high- quality services – Established platform for long-term growth
Slide 28: Cash Sale of SM&P
Cash Sale of SM&P • Divested March 31, 2008 – Sale price: $85 million • Purchase price: $43 million – Will now be part of a much larger locating entity – Proceeds will strengthen balance sheet • Will redeem $45 million of Trust Preferreds May 5, 2008
Slide 29: The Laclede Group
g The Laclede Group
Slide 30: Liquidity and Financial Capacity
Liquidity and Financial Capacity • Shelf Registration – Laclede Group: $362.4 MM remaining – Laclede Gas: $350.0 MM remaining • Financing Authority – MPSC: $500.0 MM • Lines of Credit – Laclede Group: $ 50.0 MM – Laclede Gas: $320.0 MM • 4-year line Financial Review
Slide 31: Segment Earnings 2001, 2004, 2007
a 86C6é 2001 Segment 2004 Segment 2007 Segment Earnings Earnings Earnings $30.4 $36.1 $49.8 2% 1% o% 1% 27% P 89% 64% DLaclede Gas Msmep th LER Mother Tre Laclede Group
Slide 32: Net Income ($MM)
Net Income ($MM) Note: The Laclede Group issued 1.725 million common shares in May 2004. Diluted EPS $1.82 $1.82 $1.90 $2.30 $2.31 $0.89 $0.97
Slide 33: Earnings and Dividends Per Share
Earnings and Dividends Per Share Diluted Earnings Per Share Dividends Per Share
Slide 34: Stock price high, low, average
$40 $30 $20 $10 High m Low | Average — _- — 2001 2002 2003 2004 2005 2006 2007 tte Laclede Group
Slide 35: Return
Return • Since Laclede Group was formed (October 1, 2001)* – Laclede Group annualized return: 16.3% Summary – S&P 500 Index annualized return: 7.3% • Current Fiscal Year (Beginning October 1, 2007)* – Laclede Group: 14.6% gain – S&P 500 Index: 9.4% loss
Slide 36: Summary
Summary
Slide 37: Key Takeaways
Key Takeaways • Strong Core Gas Distribution Business – Stable earnings platform – Ongoing customer service initiatives – Focus on internal improvements • Synergistic Growth Components – LER and Laclede Pipeline expansion opportunities – Asset-based opportunities complementary to core • Focus on Sha
Slide 38: The Laclede Group
The Laclede Group
Laclede Group — Midwest Utilities Seminar (April 2008) on 6ix