SPIRE INC Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q)

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(in millions of dollars, except per share amounts)

This section analyzes the financial condition and results of operations of Spire
Inc. (the "Company"), Spire Missouri Inc., and Spire Alabama Inc. Spire
Missouri, Spire Alabama and Spire EnergySouth are wholly owned subsidiaries of
the Company. Spire Missouri, Spire Alabama and the subsidiaries of Spire
EnergySouth (Spire Gulf and Spire Mississippi) are collectively referred to as
the "Utilities." This section includes management's view of factors that affect
the respective businesses of the Company, Spire Missouri and Spire Alabama,
explanations of financial results including changes in earnings and costs from
the prior periods, and the effects of such factors on the Company's, Spire
Missouri's and Spire Alabama's 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," "target," and similar
words and expressions identify forward-looking statements that involve
uncertainties and risks. Future developments may not be in accordance with our
current expectations or beliefs and the effect of future developments may not be
those anticipated. Among the factors that may cause results or outcomes to
differ materially from those contemplated in any forward-looking statement are:

• Weather conditions and catastrophic events, in particular weather conditions

we natural gas production areas;

• Impacts related to the COVID-19 pandemic and uncertainties as to their

continuous duration and severity;

• The volatility of gas prices, in particular sudden and sustained changes in

gas prices, including the related impact on margin deposits associated with

the use of natural gas derivative instruments and the impact on our

competitive position in relation to suppliers of alternative heating sources,

like electricity;

• Changes in gas supply and pipeline availability, including as a result of

decisions by natural gas producers to reduce or stop production

natural gas wells and the expiration or termination of existing supply and

transportation arrangements that are not replaced by contracts with

conditions and prices (including following a failure of the Spire STL

Pipeline to obtain permanent authorization from the FERC), as well as other

    changes that impact supply for and access to the markets in which our
    subsidiaries transact business;


  • Acquisitions may not achieve their intended results;

• Legislative, regulatory and judicial mandates and decisions, some of which may

    be retroactive, including those affecting:


  ? allowed rates of return and recovery of prudent costs,


  ? incentive regulation,


  ? industry structure,


  ? purchased gas adjustment provisions,


  ? rate design structure and implementation,


  ? capital structures established for rate-setting purposes,


  ? regulatory assets,


  ? non-regulated and affiliate transactions,


  ? franchise renewals,


  ? authorization to operate facilities,


      ? environmental or safety matters, including the potential impact of

legislative and regulatory measures related to climate change and pipeline

        safety and security,


  ? taxes,


      ? pension and other postretirement benefit liabilities and funding
        obligations, or


  ? accounting standards;


  • The results of litigation;


  • The availability of and access to, in general, funds to meet our debt

obligations before or when they become due and to fund our operations and

    necessary capital expenditures, either through (i) cash on hand, (ii)
    operating cash flow, or (iii) access to the capital markets;


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


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  • Our ability to comply with all covenants in our indentures and credit

facilities, any violation of which, if not corrected in a timely manner, could

    trigger a default of our obligation;


  • Energy commodity market conditions;


  • Discovery of material weakness in internal controls;

• Disruption, failure or malfunction of our operational and information systems

technological systems, including due to cyberattacks; and

• Labor issues, including but not limited to labor disputes,

inability to attract and retain key talent, as well as future salaries and employees

benefit costs, including costs resulting from changes in discount rates and

return on benefit plan assets.

The MD&A and discussion of financial condition and results of operations should be read in conjunction with the company’s condensed consolidated financial statements, the condensed financial statements of Spire Missouri and Spire Alabama and the accompanying notes.

PREVIEW

The Company has two reportable segments: Gas Utility and Gas Marketing. Nearly
all of Spire's earnings are derived from its Gas Utility segment, which reflects
the regulated activities of the Utilities. Due to the seasonal nature of the
Utilities' business and the Spire Missouri rate design, earnings of Spire and
each of the Utilities are typically concentrated during the heating season of
November through April each fiscal year.

Gas Utilities – Spire Missouri

Spire Missouri is Missouri's largest natural gas distribution utility and is
regulated by the MoPSC. Spire Missouri serves St. Louis, Kansas City, and other
areas throughout the state. Spire Missouri purchases natural gas in the
wholesale market from producers and marketers and ships the gas through
interstate pipelines into its own distribution facilities for sale to
residential, commercial and industrial customers. Spire Missouri also transports
gas through its distribution system for certain larger customers who buy their
own gas on the wholesale market. Spire Missouri delivers natural gas to
customers at rates and in accordance with tariffs authorized by the MoPSC. The
earnings of Spire Missouri are primarily generated by the sale of heating
energy.

Gas Utilities – Spire Alabama

Spire Alabama is the largest natural gas distribution utility in the state of
Alabama and is regulated by the APSC. Spire Alabama's service territory is
located in central and northern Alabama. Among the cities served by Spire
Alabama are Birmingham, the center of the largest metropolitan area in the
state, and Montgomery, the state capital. Spire Alabama purchases natural gas
through interstate and intrastate suppliers and distributes the purchased gas
through its distribution facilities for sale to residential, commercial, and
industrial customers, and other end-users of natural gas. Spire Alabama also
transports gas through its distribution system for certain large commercial and
industrial customers for a transportation fee. Effective December 1, 2020, for
most of these transportation service customers, Spire Alabama also purchases gas
on the wholesale market for sale to the customer upon delivery to the Spire
Alabama distribution system. All Spire Alabama services are provided to
customers at rates and in accordance with tariffs authorized by the APSC.

Gas service – Spire EnergySouth

Spire Gulf and Spire Mississippi are utilities engaged in the purchase, retail
distribution and sale of natural gas to approximately 100,000 customers in
southern Alabama and south-central Mississippi. Spire Gulf is regulated by the
APSC, and Spire Mississippi is regulated by the MSPSC.

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Gas marketing

Spire Marketing is engaged in the marketing of natural gas and related
activities on a non-regulated basis and is reported in the Gas Marketing
segment. Spire Marketing markets natural gas throughout the U.S. It holds firm
transportation and storage contracts in order to effectively manage its
transactions with counterparties, which primarily include producers,
municipalities, electric and gas utility companies, and large commercial and
industrial customers.

Other

Other elements of the Company’s consolidated information include:

• unallocated corporate elements, including certain associated debts and interests

costs;

Spire STL Pipeline LLC (“Spire STL Pipeline”) and Spire West Storage LLC

(“Spire Storage”), described below; and

• Spire’s subsidiaries engaged in the operation of a propane pipeline and the risk

management, among other activities.


Spire STL Pipeline is a wholly owned subsidiary of Spire which owns and operates
a 65-mile pipeline connecting the Rockies Express Pipeline in Scott County,
Illinois, to delivery points in St. Louis County, Missouri, including Spire
Missouri's storage facility. The pipeline is under the jurisdiction of the FERC
and is currently permitted to deliver natural gas supply into eastern Missouri
under a temporary certificate authorization. Spire STL Pipeline's operating
revenue is derived primarily from Spire Missouri as its foundation shipper.

Spire Storage is engaged in the storage of natural gas in the western region of
the United States. The facility consists of two storage fields operating under
one FERC market-based rate tariff.

COVID-19[feminine

The outbreak of coronavirus disease 2019 (COVID-19) has adversely impacted
economic activity and conditions worldwide. We are continuing to assess the
developments involving our workforce, customers and suppliers, as well as the
response of federal and state authorities, our regulators and other business and
community leaders. The Company has implemented what we believe to be appropriate
procedures and protocols to ensure the safety of our customers, suppliers and
employees. Impacts on our results of operations from COVID-19 have been minimal,
partly as a result of regulatory recovery mechanisms and approvals.

The Company is participating in the Coronavirus Aid, Relief, and Economic
Security Act (CARES Act) provisions allowing for a payroll tax deferral which
did not have an impact on our results of operations but deferred the payment of
the Company's portion of certain payroll taxes until late in fiscal 2021 and
2022. Although the Company does not currently expect to seek relief under any
other CARES Act provisions, we will continue to monitor all pending and future
federal, state and local efforts related to the COVID-19 health crisis and
assess our need and, as applicable, eligibility for any such relief.

MESURES NON CONFORMES AUX PCGR

Net income, earnings per share and operating income reported by Spire, Spire
Missouri and Spire Alabama are determined in accordance with accounting
principles generally accepted in the United States of America (GAAP). Spire,
Spire Missouri and Spire Alabama also provide the non-GAAP financial measures of
net economic earnings, net economic earnings per share and contribution margin.
Management and the Board of Directors use non-GAAP financial measures, in
addition to GAAP financial measures, to understand and compare operating results
across accounting periods, for financial and operational decision making, for
planning and forecasting, to determine incentive compensation and to evaluate
financial performance. These non-GAAP operating metrics should not be considered
as alternatives to, or more meaningful than, the related GAAP measures.
Reconciliations of non-GAAP financial measures to the most directly comparable
GAAP measures are provided on the following pages.

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Bénéfice économique net et bénéfice économique net par action

Net economic earnings and net economic earnings per share are non-GAAP measures
that exclude from net income the impacts of fair value accounting and timing
adjustments associated with energy-related transactions, the impacts of
acquisition, divestiture and restructuring activities, and the largely non-cash
impacts of impairments and other non-recurring or unusual items such as certain
regulatory, legislative or GAAP standard-setting actions. In addition, net
economic earnings per share would exclude the impact, in the fiscal year of
issuance, of any shares issued to finance acquisitions that have yet to be
included in net economic earnings.

The fair value and timing adjustments are made in instances where the accounting
treatment differs from what management considers the economic substance of the
underlying transaction, including the following:

• Gains et pertes nets non réalisés sur les dérivés liés à l’énergie

requis par les PCGR comptabilisation à la juste valeur associée aux changements actuels de

      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) variations des justes valeurs des dérivés physiques et/ou financiers

           prior to the period of settlement; and


2) les parties inefficaces des couvertures comptables, devant être enregistrées

           earnings prior to settlement, due to differences in commodity 

le prix

           changes between the locations of the forecasted physical 

acheter ou

           sale transactions and the locations of the underlying hedge
           instruments;

• Le moindre des ajustements du coût ou du marché à la valeur comptable de la marchandise

les stocks résultant de la baisse de la valeur nette de réalisation de la marchandise

      below its original cost, to the extent that those commodities are
      economically hedged; and

• Gains et pertes réalisés résultant du règlement des couvertures économiques

avant la vente de la marchandise physique.


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 transactions occur. 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.
While management uses these non-GAAP measures to evaluate all of its businesses,
the net effect of these fair value and timing adjustments on the Utilities'
earnings is minimal because gains or losses on their natural gas derivative
instruments are deferred pursuant to state regulation.

Marge de contribution

In addition to operating revenues and operating expenses, management also uses
the non-GAAP measure of contribution margin when evaluating results of
operations. Contribution margin is defined as operating revenues less natural
gas costs and gross receipts tax expense. The Utilities pass to their customers
(subject to prudence review by, as applicable, the MoPSC, APSC or MSPSC)
increases and decreases in the wholesale cost of natural gas in accordance with
their PGA clauses or GSA riders. 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 and gross receipts tax expense (which are calculated as a percentage of
revenues), with the same amount (excluding immaterial timing differences)
included in revenues, have no direct effect on operating income. Therefore,
management believes that contribution margin is a useful supplemental measure,
along with the remaining operating expenses, for assessing the Company's and the
Utilities' performance.

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BÉNÉFICES – TROIS MOIS CLOS 31 DÉCEMBRE 2021

Flèche

Revenu net et gains économiques nets

Les tableaux suivants rapprochent les bénéfices économiques nets de la société avec le chiffre GAAP le plus comparable, le bénéfice net.

                                                                                                          Per Diluted
                                                                                                             Common
                                           Gas Utility       Gas Marketing       Other        Total         Share**
Three Months Ended December 31, 2021
Net Income (Loss) [GAAP]                  $63.1     $(2.3)   $(5.1)   $55.7     $1.01
Adjustments, pre-tax: Fair value and timing adjustments - 3.7 - 3.7 0.07 Income tax adjustments* 4.1 (0.9 ) - 3.2 0.06 Net Economic Earnings (Loss) [Non-GAAP]   $67.2     $0.5 

$(5.1) $62.6 $1.14

Three Months Ended December 31, 2020
Net Income (Loss) [GAAP]                  $        76.5     $          15.2     $   (2.8 )   $   88.9     $       1.65
Adjustments, pre-tax:
Fair value and timing adjustments                  (0.1 )             (15.9 )          -        (16.0 )          (0.31 )
Income tax adjustments*                               -                 4.0            -          4.0             0.08
Net Economic Earnings (Loss) [Non-GAAP]   $        76.4     $           3.3     $   (2.8 )   $   76.9     $       1.42



* Income tax adjustments include amounts calculated by applying the

and the local income tax rates applicable to ordinary income to the amounts of

pre-tax reconciling items, and for fiscal year 2022, include a Spire Missouri

regulatory adjustment.

** The net economic result per share is calculated by replacing the consolidated net result

result with consolidated net economic result according to GAAP diluted result

per share, which includes reductions for cumulative preferred shares

dividends and participating shares.


Note: In the following discussion, all references to earnings (loss) per share
and net economic earnings per share refer to earnings (loss) per common share
and net economic earnings (loss) per common share.

Consolidated

Spire had net income of $55.7 for the three months ended December 31, 2021,
compared with net income of $88.9 for the three months ended December 31, 2020.
Income per diluted share was $1.01 for the current quarter compared to income of
$1.65 per diluted share for the prior year quarter. The net income decline of
$33.2 was primarily driven by a $17.5 reduction in the Gas Marketing segment and
$13.4 lower performance in the Gas Utility segment.

Spire's net economic earnings for the first quarter were $62.6 ($1.14 per
diluted share), compared to $76.9 ($1.42 per diluted share) in the prior year,
reflecting lower earnings at Gas Utility, combined with lower Gas Marketing
results and a decline in Other, as reflected in the above table. These impacts
are described in further detail below.

gas service

Net economic earnings for the Gas Utility segment decreased $9.2 from the first
quarter of the prior fiscal year, as all Utilities reported decreases versus
prior year performance. Spire Missouri declined by $7.1, Spire Alabama decreased
$1.5, and the subsidiaries of EnergySouth reported a $0.6 decrease versus the
prior year quarter. This decline was primarily the result of unseasonably warm
weather in the Utility territories and higher depreciation and amortization
costs. These impacts are discussed in further detail below.

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Gas marketing

The Gas Marketing segment’s net economic profit in the first quarter was $0.5compared to $3.3 last year, reflecting less favorable market conditions described in more detail below.

Other

For the three months ended December 31, 2021the net economic loss for Other increased $2.3 compared to the first quarter of the prior year, primarily reflecting higher head office costs.

Operating income and expenses and contribution margin

Reconciliations of the Company’s contribution margin to the most directly comparable GAAP measure are provided below.

                                  Gas Utility       Gas Marketing       Other       Eliminations      Consolidated
Three Months Ended December
31, 2021
Operating Income (Loss) [GAAP]   $        94.4     $          (3.1 )   $    4.0     $           -     $        95.3
Operation and maintenance
expenses                                 107.3                 2.7         10.0              (3.6 )           116.4
Depreciation and amortization             54.6                 0.3          2.0                 -              56.9
Taxes, other than income taxes            37.0                   -          0.6                 -              37.6
Less: Gross receipts tax
expense                                  (21.7 )              (0.2 )          -                 -             (21.9 )
Contribution Margin [Non-GAAP]           271.6                (0.3 )       16.6              (3.6 )           284.3
Natural gas costs                        210.2                48.0            -              (9.0 )           249.2
Gross receipts tax expense                21.7                 0.2            -                 -              21.9
Operating Revenues               $       503.5     $          47.9     $   

16.6 $(12.6) $555.4

Three Months Ended December
31, 2020
Operating Income [GAAP]          $       106.8     $          20.3     $    5.8     $           -     $       132.9
Operation and maintenance
expenses                                 103.0                 3.3          8.6              (3.3 )           111.6
Depreciation and amortization             48.6                 0.3          1.9                 -              50.8
Taxes, other than income taxes            35.5                 0.2          0.4                 -              36.1
Less: Gross receipts tax
expense                                  (21.7 )                 -            -                 -             (21.7 )
Contribution Margin [Non-GAAP]           272.2                24.1         16.7              (3.3 )           309.7
Natural gas costs                        204.3                 0.7            -             (23.8 )           181.2
Gross receipts tax expense                21.7                   -            -                 -              21.7
Operating Revenues               $       498.2     $          24.8     $   16.7     $       (27.1 )   $       512.6


Consolidated

Spire reported operating revenue of $555.4 for the three months December 31,
2021, a $42.8 increase versus the prior year quarter. Both the Gas Utility and
Gas Marketing segments experienced year-over-year increases in operating
revenues. Spire's contribution margin decreased $25.4 compared with last year,
with decreases of $24.4 in the Gas Marketing segment combined with marginal
decreases for both the Gas Utility segment and Other (STL Pipeline and Spire
Storage). Depreciation and amortization expenses were up $6.1, reflecting higher
Gas Utility expenses. Gas Utility operation and maintenance (O&M) expenses of
$107.3 for the quarter were $1.6 higher than last year, after removing the $1.7
transfer of year-over-year nonservice postretirement benefit costs to other
expense below the operating income line (the "Nonservice Cost Transfer") and
$1.0 of non-operational overheads charged to O&M as a result of the MoPSC
amended report and order effective December 23, 2021 for Spire Missouri
(discussed in   Note 4  , Regulatory Matters, of the Notes to Financial
Statements in Item 1). These impacts are described in further detail below.

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gas service

Operating Revenues - Gas Utility operating revenues for the three months ended
December 31, 2021, were $503.5, or $5.3 higher than the same period in the prior
year. The increase in Gas Utility operating revenues was attributable to the
following factors:


Arrow Missouri and Spire Alabama – Higher net PGA/GSA costs (gas cost recovery)

                                                                $  

12.1

Spire Alabama - RSE adjustments, net                                        

3.4

Spire Missouri - ISRS                                                       

0.9

Arrow Missouri and Spire Alabama – Volumetric use (net of weather attenuation)

                                                                  (5.5 )
Spire Missouri and Spire Alabama - Off-system sales and capacity
release                                                                      (4.3 )
All other factors                                                            (1.3 )
Total Variation                                                          $    5.3




The Gas Utility segment benefited $12.1 through higher gas cost recoveries, $3.4
in net rate adjustments under the RSE mechanism at Spire Alabama, and a $0.9
increase in ISRS revenues. These positive impacts were mostly offset by a $5.5
reduction attributable to volumetric usage and a $4.3 reduction related to lower
off-system sales. Weather in the current year quarter across our Utility
footprint was 19% warmer than prior year and 26% warmer than normal.

Contribution margin – Gas utility contribution margin was $271.6 for the three months ended December 31, 2021a $0.6 decrease compared to the same period of the previous year. The decrease is attributable to the following factors:



Spire Alabama - Rate adjustment under RSE mechanism, net                 $  

3.2

Spire Missouri - ISRS                                                       

0.9

Arrow Missouri and Spire Alabama – Volumetric use (net of weather attenuation)

                                                                  (1.8 )
Spire Missouri and Spire Alabama - Off-system sales and capacity
release                                                                      (0.8 )
All other factors                                                            (2.1 )
Total Variation                                                          $   (0.6 )


As previously noted, warmer weather impacted commercial and industrial sales
although weather mitigation lessened the impact on residential sales. This
decrease was partially offset by $3.2 net favorable rate adjustments under the
RSE mechanism at Spire Alabama and Spire Missouri's $0.9 ISRS increase.

Operating Expenses - O&M expenses for the three months ended December 31, 2021,
were $4.3 higher than the prior year. After removing the $1.7 impact of the
Nonservice Cost Transfer and $1.0 of non-operational overheads mentioned
earlier, expenses increased $1.6. The increase was largely due to modestly
higher costs in operations, and employee-related expenses, partly offset by
lower bad debt expense. Depreciation and amortization expenses for the quarter
were $6.0 higher than the same period in the prior year primarily driven by
continued infrastructure capital expenditures across all the Utilities.

Gas marketing

Operating revenue – Increase in operating revenue $23.1 compared to the prior year period as higher volumes and commodity prices were partially offset by derivatives activity and unrealized fair value adjustments.

Contribution Margin - Gas Marketing contribution margin during the quarter ended
December 31, 2021, decreased $24.4 from the same period in the prior year, due
principally to a $19.6 unfavorable change in derivative activity and fair value
measurements. The remaining decrease of $4.8 reflects both less favorable market
conditions and lower storage margins.

Interest charges

Consolidated interest charges increased by $2.9, principally due to higher Gas
Utilities long-term debt and higher average short term borrowings in the current
year. For the three months ended December 31, 2021 and 2020, average short-term
borrowings were $808.6 and $734.7, respectively, and the average interest rate
on these borrowings was 0.4% in both periods.

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Income taxes

Consolidated income tax for the three months ended December 31, 2021, decreased
$4.2 versus the same period in the prior year. The variance is due principally
to the lower pre-tax book income, offset partly by a $4.1 Spire Missouri
regulatory adjustment.

Spire Missouri

                                          Three Months Ended December 31,
                                           2021                     2020
Operating Income [GAAP]              $           65.4         $           75.5
Operation and maintenance expenses               66.3                     

62.9

Depreciation and amortization                    34.2                     

30.4

Taxes, other than income taxes                   25.7                     

25.1

Less: Gross receipts tax expense                (14.9 )                  (15.2 )
Contribution Margin [Non-GAAP]                  176.7                    178.7
Natural gas costs                               156.3                    161.6
Gross receipts tax expense                       14.9                     15.2
Operating Revenues                   $          347.9         $          355.5
Net Income                           $           45.3         $           56.6


Operating revenues for the three months ended December 31, 2021, decreased $7.6
from the same period in the prior year primarily due to $14.7 in unfavorable
volumetric impacts (including weather mitigation), and a $2.8 decrease related
to lower off-system sales, primarily due to warmer weather.

Contribution margin for the three months ended December 31, 2021, decreased $2.0
from the same period in the prior year, largely the result of a $1.0 decrease
due volumetric impacts (including weather mitigation) and $0.6 lower off-system
sales.

O&M expenses increased $3.4 versus the prior year. After removing the $1.7
year-over-year impact of the Nonservice Cost Transfer and $1.0 of
non-operational overheads mentioned earlier, the increase was $0.7. The increase
was largely due to modestly higher costs in administrative and employee-related
expenses. Depreciation and amortization increased $3.8 versus the prior-year
quarter due to ongoing capital investments.

Other income increased $3.2primarily due to fair market value adjustments of non-qualified pension trusts, slightly offset by the transfer of out-of-service costs.

Resulting net profit for the quarter ended December 31, 2021decreases $11.3
compared to the quarter of the previous year.

Degree days in Spire Missouri's service areas during the three months ended
December 31, 2021, were 25.9% warmer than normal, and 19.5% warmer than the same
period last year, resulting in lower usage on a year-over-year comparative
basis. Spire Missouri's total system therms sold and transported were 439.6
million for the quarter, compared with 522.8 million for the same period in the
prior year. Total off-system therms sold and transported were 2.1 million for
the quarter, compared with 8.5 million a year ago.

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Spire Alabama

                                          Three Months Ended December 31,
                                           2021                     2020
Operating Income [GAAP]              $           21.1         $           22.5
Operation and maintenance expenses               34.5                     

32.8

Depreciation and amortization                    16.5                     

15.0

Taxes, other than income taxes                    9.0                      

8.2

Less: Gross receipts tax expense                 (5.7 )                   (5.3 )
Contribution Margin [Non-GAAP]                   75.4                     73.2
Natural gas costs                                45.5                     35.1
Gross receipts tax expense                        5.7                      5.3
Operating Revenues                   $          126.6         $          113.6
Net Income                           $           12.2         $           13.7


Operating revenues for the three months ended December 31, 2021, increased $13.0
from the same period in the prior year. The change in operating revenue was
principally due to $9.2 attributable to favorable weather usage impacts, net
favorable rate adjustments under the RSE mechanism of $3.4, higher gas cost
recoveries of $1.5, slightly offset by a decrease in off-system sales totaling
$1.5.

Contribution margin was $2.2 higher versus the prior-year quarter, primarily
driven by the favorable net rate adjustments under the RSE mechanism of $3.2,
partly offset by $0.8 weather/usage impacts and $0.2 lower off-system sales.

O&M expenses for the three months ended December 31, 2021, increased $1.7 versus
the prior-year quarter, primarily due to higher employee-based costs that were
only partly offset by lower bad debt expense. Depreciation and amortization
expenses were up $1.5, the result of continued investment in infrastructure
upgrades.

For the quarter ended December 31, 2021net income decreased $1.5
compared to the quarter of the previous year.

As measured in degree days, temperatures in Spire Alabama's service area during
the three months ended December 31, 2021, were 10.5% warmer than normal but 6.1%
colder than a year ago. Spire Alabama's total system therms sold and transported
were 257.8 million for the three months ended December 31, 2021, compared with
244.4 million for the same period in the prior year. Total off-system therms
sold and transported were 0.1 million for the quarter, compared with 13.6
million a year ago.

CASH AND CAPITAL RESOURCES

Recent Cash Flows

                                                        Three Months Ended
                                                           December 31,
Cash Flow Summary                                        2021          2020

Net cash (used in) provided by operating activities $(229.9) $7.6
Net cash used in investing activities

                     (143.1 )     (163.6 )
Net cash provided by financing activities                  376.9        155.4




For the three months ended December 31, 2021, net cash from operating activities
decreased $237.5 from the corresponding period of fiscal 2021. In addition to
the decline in net income of $33.2, the change was due principally to regulatory
timing and fluctuations in working capital items, as discussed below in the
Future Cash Requirements section. Those typical variance drivers have been
impacted by Spire Missouri's Operational Flow Order and Filing Adjustment Factor
put into place last year, as discussed in   Note 4  , Regulatory Matters, of the
Notes to Financial Statements in Item 1.

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For the three months ended December 31, 2021, net cash used in investing
activities was $20.5 less than for the same period in the prior year, primarily
driven by a $17.9 decrease in capital expenditures. The primary drivers of the
lower capital expenditures were a $9.0 decline related to Spire Storage and
Spire STL Pipeline, and a $8.2 spending decline at Gas Utility.

Lastly, for the three months ended December 31, 2021, net cash provided by
financing activities was up $221.5 versus net cash provided for the three months
ended December 31, 2020. Current year long-term debt issuances were $300.0, or
$150.0 higher than a year ago, and net short-term debt issuances rose $125.9 in
the current period. Partially offsetting these fluctuations was a $50.4 increase
in long-term debt repayments during the first quarter of fiscal 2022 versus the
same prior year period.

Future Cash Requirements

The Company's short-term borrowing requirements typically peak during colder
months when the Utilities borrow money to cover the lag between when they
purchase natural gas and when their customers pay for that gas. Changes in the
wholesale cost of natural gas (including cash payments for margin deposits
associated with Spire Missouri's use of natural gas derivative instruments),
variations in the timing of collections of gas cost under the Utilities' PGA
clauses and GSA riders, the seasonality of accounts receivable balances, and the
utilization of storage gas inventories cause short-term cash requirements to
vary during the year and from year to year, and may cause significant variations
in the Company's cash provided by or used in operating activities.

Spire's material cash requirements as of December 31, 2021, are related to
capital expenditures, principal and interest payments on long-term debt, natural
gas purchase obligations, and dividends. Except for Spire Missouri's December
2021 issuance of $300.0 of floating rate bonds due in December 2024, there were
no material changes outside the ordinary course of business from the future cash
requirements discussed in the Company's Annual Report on Form 10-K for the
fiscal year ended September 30, 2021. Total Company capital expenditures are
planned to be $570 for fiscal 2022.

Source of funds

It is management's view that the Company, Spire Missouri and Spire Alabama have
adequate access to capital markets and will have sufficient capital resources,
both internal and external, to meet anticipated requirements. Their debt is
rated by two rating agencies: Standard & Poor's Corporation ("S&P") and Moody's
Investors Service ("Moody's"). As of December 31, 2021, the debt ratings of the
Company, Spire Missouri and Spire Alabama (shown in the following table) remain
at investment grade with a stable outlook (other than Moody's negative outlook
for Spire Missouri debt).



                                                S&P    Moody's

Spire inc. BBB+ long-term senior unsecured debt Baa2 Spire Inc. favorite stock

                      BBB      Ba1
Spire Inc. short-term debt                      A-2      P-2

Arrow Missouri Senior secured long-term debt A A1 Speyer Alabama Senior unsecured long-term debt A- A2

Cash and cash equivalents

Bank deposits were used to meet the company’s working capital requirements. Spire had no short-term cash investments December 31, 2021.

Short term debt

The Company's short-term cash requirements can be met through the sale of up to
$975.0 of commercial paper or through the use of Spire's $975.0 revolving credit
facility. For information about short-term borrowings, see   Note 5   of the
Notes to Financial Statements in Item 1.

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Long-term debt and equity

At December 31, 2021, including the current portion but excluding unamortized
discounts and debt issuance costs, Spire had long-term debt totaling $3,258.9,
of which $1,648.0 was issued by Spire Missouri, $575.0 was issued by Spire
Alabama, and $205.9 was issued by other subsidiaries. For information about
long-term debt issued this fiscal year, see   Note 5   of the Notes to Financial
Statements in Item 1.

Spire Missouri was authorized by the MoPSC to issue registered securities (first
mortgage bonds, unsecured debt and preferred stock), common stock, and private
placement debt in an aggregate amount of up to $660.0 for financings placed any
time before September 30, 2023. As of December 31, 2021, $55.0 remained
available under this authorization, and Spire Missouri has applied for a new
$800.0 authorization over three years. Spire Alabama has no standing authority
to issue long-term debt and must petition the APSC for each planned issuance.

Spire has a shelf registration statement on Form S-3 on file with the U.S.
Securities and Exchange Commission (SEC) for the issuance and sale of up to
250,000 shares of common stock under its Dividend Reinvestment and Direct Stock
Purchase Plan. There were 176,456 and 170,904 shares at December 31, 2021 and
January 28, 2022, respectively, remaining available for issuance under this Form
S-3. Spire and Spire Missouri also have a universal shelf registration statement
on Form S-3 on file with the SEC for the issuance of various equity and debt
securities, which expires on May 14, 2022.

On February 6, 2019, Spire entered into an "at-the-market" equity distribution
agreement, supplemented as of May 14, 2019, pursuant to which the Company may
offer and sell, from time to time, shares of its common stock having an
aggregate offering price of up to $150.0. Those shares are issued pursuant to
Spire's universal shelf registration statement referenced above and a prospectus
supplement dated May 14, 2019. Under this program, a total of 626,249 shares
were issued in fiscal 2019 and 2020, and as of December 31, 2021, Spire can
still issue shares having an aggregate offering price of up to $102.2.

Taking into account the current portion of long-term debt, the consolidated long-term capitalization of the Company consisted of 45% equity at December 31, 2021and 47% equity at September 30, 2021.

ENVIRONMENTAL ISSUES

The Utilities and other Spire subsidiaries own and operate 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, Spire
Missouri's, or Spire Alabama's financial position and results of operations. As
environmental laws, regulations, and interpretations change, however, the
Company and the Utilities may be required to incur additional costs. For
information relative to environmental matters, see Contingencies in   Note 10
of the Notes to Financial Statements in Item 1.

REGULATORY MATTERS

For discussions of regulatory matters for Spire, Spire Missouri and Spire Alabama, see Note 4, Regulatory Matters, Notes to Financial Statements at 1.

ACCOUNTING PRONOUNCEMENTS

The Company, Spire Missouri and Spire Alabama have assessed or are in the process of assessing the effects that recently issued accounting standards will have on the financial condition or results of operations of the companies upon their adoption, but none are currently expected to have an impact. significant impact.

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CRITICAL ACCOUNTING ESTIMATES

Our discussion and analysis of our financial condition, results of operations,
liquidity and capital resources are based upon our financial statements, which
have been prepared in accordance with GAAP, which 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 estimates used in the preparation of
our financial statements are described in Item 7 of Spire, Spire Missouri, and
Spire Alabama's combined Annual Report on Form 10-K for the fiscal year ended
September 30, 2021, and include regulatory accounting, employee benefits and
postretirement obligations, impairment of long-lived assets, and income taxes.
There were no significant changes to critical accounting estimates during the
three months ended December 31, 2021.

For discussion of other significant accounting policies, see   Note 1   of the
Notes to Financial Statements included in this Form 10-Q as well as Note 1 of
the Notes to Financial Statements included in Spire, Spire Missouri, and Spire
Alabama's combined Annual Report on Form 10-K for the fiscal year ended
September 30, 2021.

MARKET RISK

There were no material changes in the Company's commodity price risk or
counterparty credit risk as of December 31, 2021, relative to the corresponding
information provided in the Company's Annual Report on Form 10-K as of September
30, 2021. In the second fiscal quarter of 2020, the Company entered into
multiple ten-year interest rate swaps with fixed interest rates ranging from
0.934% to 1.2975% for a total notional amount of $75.0 to protect itself against
adverse movements in interest rates on future interest rate payments. The
Company recorded a $1.2 mark-to-market loss in accumulated other comprehensive
income on these swaps for the three months ended December 31, 2021. In the third
quarter of 2021 the Company entered into multiple ten-year interest rate swaps
with fixed interest rates ranging from 2.008% to 2.1075% for a total notional
amount of $150.0 to protect itself against adverse movements in interest rates
on future interest rate payments. The Company recorded a $2.1 mark-to-market
loss in accumulated other comprehensive income on these swaps for the three
months ended December 31, 2021.

In the fourth quarter of 2021, the Company entered into two swap contracts. Both
contracts are ten-year interest rate swaps; the first swap has a notional amount
of $50.0 with a fixed interest rate of 1.597%, while the second swap has a
notional amount of $50.0 with a fixed interest rate of 1.821%. The Company
recorded a $1.9 mark-to-market loss to accumulated other comprehensive income on
these swaps for the three months ended December 31, 2021.

In the first quarter of fiscal 2022, the Company entered into a ten-year
interest rate swap contract with a notional amount of $50.0 with a fixed
interest rate of 1.4918%. The Company recorded a $0.3 mark-to-market gain to
accumulated other comprehensive income on this swap for the three months ended
December 31, 2021.

From December 31, 2021the Company recognized in accumulated other comprehensive income an accumulated net asset at market value of $2.1 on open swaps.

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