MDU Resources Group (MDU) Q3 2024 earnings summary

Executive summary

• Completed the Everus Construction Group spinoff on October 31, 2024, following the prior Knife River spinoff, transitioning to a pure-play regulated energy delivery business focused on electric, natural gas distribution, and pipeline segments.

• Marked 100 years in operation in 2024 and 75 years of continuous NYSE listing.

• Focused on operational excellence, customer and community growth, strategic capital allocation, and employee engagement.

• Board established a long-term dividend payout ratio target of 60–70% of regulated energy delivery earnings.

• Third quarter results reflect strong operational performance and positive momentum across utility, pipeline, and construction services segments.

Financial highlights

• Q3 2024 GAAP net income was $64.6 million ($0.32/share), down from $74.9 million ($0.37/share) in Q3 2023; adjusted income from continuing operations was $65.5 million ($0.32/share), up from $58.6 million ($0.29/share).

• Q3 2024 operating revenues were $1.05 billion, up from $1.00 billion in Q3 2023.

• Electric utility Q3 earnings rose 16% to $24.3 million, and pipeline segment posted record Q3 earnings of $15.1 million, up 27% year-over-year.

• Natural gas distribution Q3 2024 loss narrowed to $17.5 million, with improved rate relief offsetting lower volumes.

• Cash flow from operations for the nine months ended September 30, 2024, was $441.8 million, up from $174.9 million in 2023.

Outlook and guidance

• Increased and narrowed 2024 regulated energy delivery earnings guidance to $180–$185 million, up from the previous $170–$180 million range.

• Expects electric and natural gas distribution rate base growth of ~7% annually over the next five years, with customer growth projected at 1–2% per year.

• Long-term EPS growth targeted at 6–8%, with a 60–70% annual dividend payout ratio.

• Optimistic about continued customer and system growth, with additional pipeline expansion projects underway and no planned equity issuances for the remainder of 2024.

• 580 MW of data center load under signed agreements, with 180 MW online and 400 MW phased in over three years.