Otter Tail (OTTR) Q4 2024 earnings summary

Executive summary

• Achieved record 2024 diluted EPS of $7.17 and ROE of 19.3%, with strong electric segment growth and a fully settled North Dakota rate case.

• Updated five-year capital spending plan to $1.4 billion for Otter Tail Power, a 9% rate base CAGR, and increased long-term EPS growth target to 6–8%.

• 2025 EPS guidance set at $5.68–$6.08, reflecting expected Electric segment growth and declines in Manufacturing and Plastics.

• Strategic diversification between electric (65%) and manufacturing (35%) segments, with uninterrupted dividends for 86 years.

• Dividend increased 12.3% to $2.10 per share for 2025.

Financial highlights

• 2024 net income was $301.7 million, diluted EPS $7.17, and ROE 19.3%, up from $294.2 million, $7.00, and 19% in 2023.

• Electric segment earnings grew nearly 8% year-over-year; 2024 EPS $2.16, up from $2.01.

• Plastics segment delivered record EPS of $4.77, with sales volumes up 27% and prices down 12%.

• Manufacturing segment earnings declined due to lower volumes and higher costs; sales volumes fell 15%.

• Available liquidity at year-end was $606.3 million, including $294.7 million in cash.

Outlook and guidance

• 2025 diluted EPS guidance: $5.68–$6.08, with Electric segment earnings expected to grow ~7% and declines of 27% and 29% in Manufacturing and Plastics, respectively.

• Long-term EPS growth target increased to 6–8%; total shareholder return target raised to 9–11%.

• Five-year capital spending plan totals $1.4 billion, driving a 9% CAGR in electric rate base.

• Long-term earnings mix targeted at 65% electric, 35% manufacturing by 2028.

• 2025 indicated dividend of $2.10, a 12.3% increase, with targeted dividend growth rate of 6–8%.