MDU Resources (US:MDU)2026-02-05 20:02Financial Data and Key Metrics Changes - In 2025, the company reported earnings of $190.4 million, or $0.93 per share, which was in the middle of the earnings per share guidance range [3] - Compared to 2024, earnings decreased from $281.1 million, or $1.37 per share [15] - Income from continuing operations was $191.4 million, or $0.93 per diluted share, compared to $181.1 million, or $0.88 per diluted share in 2024 [15] Business Line Data and Key Metrics Changes - The electric utility segment reported earnings of $64.9 million, down from $74.8 million in 2024, primarily due to higher operation and maintenance expenses [15][16] - The natural gas utility reported earnings of $56.1 million, a 19.6% increase from $46.9 million in 2024, driven by higher retail sales revenue [15][16] - The pipeline business achieved record earnings of $68.2 million, slightly up from $68 million in the previous year, supported by expansion projects and customer demand [15][17] Market Data and Key Metrics Changes - The utility experienced combined retail customer growth of 1.5% compared to 2024, aligning with the targeted annual growth rate of 1%-2% [3] - The company has 580 MW of data center load under signed electric service agreements, with various phases of load coming online through 2027 [9] Company Strategy and Development Direction - The company is focused on executing its capital investment plans, with a revised 2026 through 2030 capital investment plan totaling $3.1 billion [4] - The acquisition of Badger Wind Farm is a key strategic move, enhancing the company's diversified generation portfolio [4] - The company anticipates a long-term EPS growth rate of 6%-8% and targets a 60%-70% annual dividend payout ratio [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to execute long-term growth strategies and emphasized operational focus and financial discipline [13] - The company is initiating earnings per share guidance for 2026 in the range of $0.93-$1.00 per share, reflecting strong performance across segments [12] Other Important Information - The company completed a follow-on public offering of over 10.15 million shares at a price of $19.70 per share, which is expected to meet equity issuance needs for 2026 and a significant portion of 2027 [19] - The consolidated debt-to-capitalization ratio increased slightly to 49.1% due to the Badger Wind Farm acquisition [19] Q&A Session Summary Question: Can you elaborate on the 2026 guidance and year-over-year headwinds? - Management indicated that while 2025 showed strong growth, 2026 guidance reflects a range of 6%-8% EPS growth, with some headwinds expected from rate case activities and equity issuance [25][26] Question: What are the next steps for the Bakken East Pipeline project? - Management outlined that the binding open season is ongoing until mid-March, and discussions with customers are progressing, with plans to finalize project design and customer agreements before making a final investment decision [27][28]