Otter Tail (OTTR) Q2 2025 earnings summary

Executive summary

• Q2 2025 diluted EPS was $1.85, surpassing expectations but down from $2.07 in Q2 2024, with a trailing twelve-month ROE of 17%.

• Net income for Q2 2025 was $77.7 million, down 10.7% year-over-year; six-month net income was $145.8 million, down 9.6%.

• Severe weather in June caused major outages, affecting up to one-third of customers, but recovery was swift.

• Regulatory approvals secured for 345 MW of solar projects and a South Dakota rate case filed seeking a $5.7 million increase.

• Dividend for 2025 indicated at $2.10, a 12.3% increase, with a quarterly dividend of $0.525 per share declared.

Financial highlights

• Q2 2025 net income was $77.7 million (down from $87.0 million in Q2 2024); diluted EPS was $1.85 (down from $2.07).

• Q2 2025 operating revenues were $333.0 million, a 2.7% decrease year-over-year.

• Electric segment Q2 2025 EPS: $0.46, up from $0.44 year-over-year; Manufacturing: $0.08, up from $0.02; Plastics: $0.05, down from $1.44.

• Over $300 million in cash on hand and total available liquidity of $688.2 million as of June 30, 2025.

• Q2 2025 gross margin was 29.3%.

Outlook and guidance

• 2025 EPS guidance raised to $6.06–$6.46, with the midpoint up to $6.26 from $5.88.

• Electric segment expected to grow earnings over 7% year-over-year; long-term EPS growth target of 6–8%.

• Plastics segment earnings expected to normalize to $45–$50 million by 2028, with margin compression through 2027.

• No external equity needs anticipated through 2029.

• Management expects continued strong liquidity with $688.2 million available as of June 30, 2025.