The Laclede Group, Inc. (Form: 8-K)

The Laclede Group Announces Improved First Quarter
Results, Driven by Non-Regulated and Off-System Earnings

ST. LOUIS, January 26, 2006 — The Laclede Group (NYSE: LG) today released its earnings report for the first quarter of its fiscal year 2006.

The Laclede Group’s earnings for the quarter that ended December 31, 2005 were $26.2 million, compared to $16.6 million for the same period last year, with a majority of the increase coming from The Laclede Group’s non-regulated subsidiaries and Laclede Gas’ off-system marketing efforts. On an earnings-per-share basis, first quarter earnings for fiscal 2006 were $1.23, compared with $.79 during the same period last year.

The Laclede Group’s two principal nonregulated subsidiaries each generated increased period-to-period earnings. Laclede Energy Resources (LER), which offers natural gas commodity services to industrial and commercial customers throughout the Midwest, including the St. Louis area, reported earnings that were $4.0 million more than in the same period last year. LER’s earnings improved as a result of increased margins caused by higher price volatility and regional supply/demand imbalances due to the recent hurricanes, as well as higher wholesale sales volumes. SM&P Utility Resources, Inc., an underground facility locating and marking service business, earned $.3 million more during this year’s first quarter than in the first quarter of last year. SM&P continues to attain new business in existing markets.

Total earnings for Laclede Gas Company, Missouri’s largest natural gas distribution utility, improved by approximately $5.1 million this year over the first quarter of fiscal 2005. However, the increase at Laclede Gas resulted primarily from the sale of natural gas to entities outside its traditional service area, as opposed to sales of gas to its ratepayers. The net benefit of rate changes applicable to the regulated service area implemented October 1, 2005, and higher sales volumes resulting from weather that was colder than last year also contributed to the increase.

Such benefits were partially offset by the effect of higher operating expenses this year and the negative impacts of record high wholesale natural gas prices.

Core gas distribution revenues increased reflecting the higher wholesale gas prices paid by the Utility to acquire its gas supplies, and colder weather compared to last year. It should be noted that the higher gas prices do not benefit earnings as gas costs are flowed through to customers without markup. Additionally, Laclede Gas’ rate design helped to mitigate the impact of the colder weather on its regulated customers while providing a more stable earnings base for the Company.

To help manage this year’s winter heating bills, Laclede Gas recommends that customers sign up for Budget Billing, weatherize their premises, and have their heating equipment inspected and maintained by a qualified service provider. The Company is also making available approximately $1.5 million for energy assistance and a weatherization program to low-income households in its service area. For additional information on these and other programs, we encourage customers to visit our website (www.lacledegas.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-K for the year ended September 30, 2005, filed with the Securities and Exchange Commission.


	Three Months Ended
	December 31,
	2005		2004
OPERATING REVENUES
Regulated
Gas distribution	$	411,401	$	291,253
Non-Regulated
Services		35,458		27,986
Gas marketing		241,332		118,179
Other		1,044		5,067

Total operating revenues		689,235		442,485

OPERATING EXPENSES
Regulated
Natural and propane gas		312,039		206,424
Other operation expenses		33,105		30,925
Maintenance		4,988		4,214
Depreciation and amortization		6,083		5,305
Taxes, other than income taxes		19,639		15,823

Total regulated operating expenses		375,854		262,691
Non-Regulated
Services		33,919		26,872
Gas marketing		232,474		115,786
Other		851		5,171

Total operating expenses		643,098		410,520

Operating Income		46,137		31,965

Other Income and (Income Deductions) – Net		1,285		1,574

Interest Charges:
Interest on long-term debt		5,643		5,908
Interest on long-term debt to		893		893
unconsolidated affiliate trust
Other interest charges		2,123		970

Total interest charges		8,659		7,771

Income Before Income Taxes		38,763		25,768
Income Tax Expense		12,583		9,136

Net Income		26,180		16,632
Dividends on Redeemable Preferred Stock – Laclede Gas		12		15

Net Income Applicable to Common Stock	$	26,168	$	16,617

Average Number of Common Shares Outstanding		21,191		21,018
Basic Earnings Per Share of Common Stock	$	1.23	$	.79
Diluted Earnings Per Share of Common Stock	$	1.23	$	.79


Missouri	1-16681	74-2976504
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)

720 Olive Street, St. Louis, Missouri		63101
_________________________________ (Address of principal executive offices)		___________ (Zip Code)


	The Laclede Group, Inc.

January 25, 2006	By:	Douglas H. Yaeger

		Name: Douglas H. Yaeger
		Title: Chairman of the Board, President and Chief Executive Officer


Exhibit No.		Description

99.1		Earnings Press Release dated January 26, 2006


Date of Report (Date of Earliest Event Reported):		January 26, 2006


Registrant’s telephone number, including area code:		314-342-0500