MGE Energy (MGEE) Q3 2024 earnings summary

Executive summary

• Serves approximately 163,000 electric and 176,000 gas customers, with a diversified and resilient revenue base across residential, commercial, and industrial segments.

• Reported GAAP net income for Q3 2024 was $40.9 million ($1.13/share), up from $37.9 million ($1.05/share) year-over-year; nine-month net income was $98.5 million ($2.72/share), up from $97.6 million ($2.70/share) year-over-year.

• Electric utility earnings rose due to increased investments and lower fuel costs; gas utility earnings declined on lower sales from warmer weather.

• Focused on sustainability, targeting net-zero carbon electricity by 2050 and net-zero methane emissions from natural gas distribution by 2035, with an interim goal of 80% carbon reduction by 2030.

• Service territory is economically resilient, with above-average growth and low unemployment.

Financial highlights

• Q3 2024 operating revenues were $168.5 million, up from $160.5 million year-over-year; nine-month revenues were $505.5 million, down from $525.8 million year-over-year.

• Q3 operating income was $48.1 million, up from $43.8 million; nine-month operating income was $118.6 million, down from $122.2 million year-over-year.

• Diluted EPS for Q3 2024 was $1.13, up from $1.05 in Q3 2023; year-to-date EPS was $2.72, slightly up from $2.70 for the same period last year.

• Dividends per share increased to $0.450 in Q3 and $1.305 for nine months, up from $0.428 and $1.243, respectively.

• Cash provided by operating activities for nine months was $209.8 million, up from $194.0 million year-over-year.

Outlook and guidance

• Forecasted capital investment of ~$1.4B from 2025 through 2029, with significant focus on renewables and grid reliability.

• PSCW approved electric rate increases of 1.54% for 2024 and 4.17% for 2025; gas rates up 2.44% in 2024 and 1.32% in 2025.

• 2025 Fuel Cost Plan filed to lower 2025 electric rate increase to 2.47% pending PSCW decision.

• Capital expenditures forecasted at $226 million for 2024, rising to $312 million by 2029, with major investments in renewables and grid modernization.

• Ongoing expansion of renewables and battery storage, with multiple projects scheduled through 2028.