MDU Resources (US:MDU)2024-08-08 12:32Financial Performance - Total operating revenues for the three months ended June 30, 2024, were $1,047.5 million, a decrease of 16.5% compared to $1,506.8 million for the same period in 2023[23]. - Operating income for the six months ended June 30, 2024, was $225.7 million, an increase of 12.8% from $200.6 million in the prior year[23]. - Net income for the three months ended June 30, 2024, was $60.4 million, down 53.8% from $130.7 million in the same period last year[23]. - Adjusted income from continuing operations for the three months ended June 30, 2024, was $65.2 million, compared to $60.0 million for the same period in 2023, reflecting a 3.3% increase[32]. - Earnings per share from continuing operations for the three months ended June 30, 2024, were $0.30, down from $0.72 in the same period last year, representing a decline of 58.3%[32]. - Operating revenues for the three months ended June 30, 2024, were $703.3 million, a decrease of 6% compared to $747.0 million for the same period in 2023[50]. - The company reported a total operating expense of $957.8 million for the three months ended June 30, 2024, a decrease of 5.1% from $1,009.1 million in the same period last year[23]. - The company experienced a 13% decrease in operation and maintenance costs for the six months ended June 30, 2024, totaling $1,115.7 million compared to $1,283.2 million in 2023[50]. - Interest expense increased by 74% to $3.3 million for the three months ended June 30, 2024, compared to $1.9 million in the same period of 2023[50]. - The company reported a 4% increase in gross profit for the six months ended June 30, 2024, totaling $163.3 million compared to $157.2 million in 2023[50]. Segment Performance - Pipeline segment achieved record second quarter earnings of $17.3 million, up approximately 99% from $8.7 million in Q2 2023[7]. - Utility earnings totaled $10.5 million, a decrease of $2.6 million compared to the previous year, impacted by cooler weather and higher operational expenses[4]. - Construction services segment reported earnings of $39.0 million, slightly up from $38.6 million in Q2 2023, with a record backlog of $2.4 billion[10]. - Net income for the electric business was $15.5 million in Q2 2024, down from $16.3 million in Q2 2023, reflecting a 5% decrease[39]. - The natural gas distribution business reported a seasonal loss of $5.0 million in Q2 2024, compared to a loss of $3.2 million in Q2 2023, primarily due to higher operation and maintenance expenses[43]. - EBITDA for the natural gas distribution business increased by $1.3 million in Q2 2024, driven by higher retail sales[44]. - The pipeline business reported operating revenues of $52.9 million in Q2 2024, a 26% increase from $42.1 million in Q2 2023[46]. - The pipeline business's net income rose to $17.3 million in Q2 2024, up 99% from $8.7 million in Q2 2023, attributed to higher transportation volumes and new service rates[47]. - The pipeline business's EBITDA increased by $12.3 million in Q2 2024, primarily from higher transportation and storage revenues[48]. - The construction services business reported a record net income of $39.0 million for the second quarter of 2024, up 1% from $38.6 million in the same quarter of 2023[53]. Revenue Guidance and Expectations - Updated construction services revenue guidance for 2024 is now $2.65 billion to $2.85 billion, down from the previous range of $2.9 billion to $3.1 billion[11]. - The company expects EBITDA for construction services to be in the range of $220 million to $240 million for 2024[13]. - The company expects EBITDA guidance for 2024 to range between $220.0 million and $240.0 million[35]. Operational Metrics - Total capital expenditures for 2024 are estimated at $625 million, with a total estimated expenditure of $2,776 million from 2024 to 2028[26]. - The total backlog at June 30, 2024, reached an all-time record of $2,403 million, with electrical and mechanical backlog up 34% year-over-year[54]. - Customer natural gas storage balance at the end of the period increased to 41.4 MMdk in Q2 2024 from 27.8 MMdk in Q2 2023[47]. Market and Shareholder Information - Book value per common share increased to $14.80 in Q2 2024 from $13.29 in Q2 2023[59]. - Market price per common share rose to $25.10 in Q2 2024, compared to $20.94 in Q2 2023[59]. - Total assets increased to $7,960 million in Q2 2024 from $7,685 million in Q2 2023[59]. - Total equity grew to $3,018 million in Q2 2024, up from $2,706 million in Q2 2023[59]. Strategic Initiatives - The company is working towards a tax-free spinoff of Everus Construction Group, expected to be finalized in late 2024[11]. - Strategic rate relief initiatives helped mitigate impacts from inflation and cooler weather, with temperatures being 37% cooler in Q2 2024 compared to Q2 2023[5]. - The utility filed for a natural gas rate case requesting an annual revenue increase of $9.4 million, or 11.1%, pending a decision[6]. Other Notable Information - The company completed the separation of Knife River on May 31, 2023, impacting financial results significantly[56]. - The absence of a $90.8 million unrealized gain from Knife River contributed to the decrease in net income for Q2 2024[57].