MDU RESOURCES GROUP INC SEC 10-Q Report

MDU Resources Group Inc., a diversified energy company, has released its Form 10-Q report for the third quarter, providing a detailed overview of its financial and operational performance. The report highlights significant growth in operating revenues and income, alongside strategic business developments and future outlooks in the energy sector.

Financial Highlights

Operating Revenues: The company reported operating revenues of $674.8 million, reflecting an increase from $588.3 million in the prior year. This growth was driven by higher volumes and rate relief in the natural gas distribution segment.

Operating Income: Operating income rose to $112.9 million, up from $96.7 million, primarily due to increased revenues in the natural gas distribution and pipeline segments.

Net Income: Net income for the quarter was $82.0 million, a decrease from $100.9 million in the previous year. This decline was largely due to the absence of income from discontinued operations following the separation of Everus.

Earnings per Share - Basic: Basic earnings per share were $0.40, compared to $0.50 in the previous year, reflecting the impact of the Everus separation.

Earnings per Share - Diluted: Diluted earnings per share were $0.40, down from $0.49, consistent with the decrease in net income.

Business Highlights

Revenue Segments: The electric segment reported operating revenues of $112.4 million, with retail sales contributing $93.9 million and other revenues $18.5 million. The natural gas distribution segment reported $539.2 million in operating revenues, while the pipeline segment contributed $23.3 million.

Geographical Performance: The electric segment experienced increased retail sales revenue due to higher volumes to residential customers, primarily in North Dakota, driven by colder weather and increased demand from a data center near Ellendale.

Sales Units: The electric segment reported retail sales volumes of 370.7 million kWh for residential, 723.9 million kWh for commercial, and 116.7 million kWh for industrial customers.

Operational Challenges: The electric segment faced higher operation and maintenance expenses due to increased contract services related to electric generation station outages, software expenses, and payroll-related costs.

Future Outlook: The company anticipates continued investment in infrastructure upgrades to meet regulatory requirements and customer needs, with a focus on modernizing utility infrastructure and expanding renewable energy sources.

Regulatory Developments: The company is actively engaged in regulatory proceedings to recover increased costs associated with electric fuel and purchased power, particularly in North Dakota, South Dakota, and Montana.

Market Trends: The company is managing inflationary pressures, supply chain disruptions, and elevated interest rates, which impact borrowing costs and customer purchasing power.

Strategic Initiatives: The company completed the separation of Everus, its former construction services business, to focus on its core regulated energy delivery operations, with a long-term dividend payout ratio target of 60-70% of regulated earnings.

SEC Filing: MDU RESOURCES GROUP INC [ MDU ] - 10-Q - May. 08, 2025