MGE (MGEE) came out with quarterly earnings of $1.14 per share, beating the Zacks Consensus Estimate of $0.98 per share. This compares to earnings of $0.93 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 16.33%. A quarter ago, it was expected that this public utility holding company would post earnings of $0.84 per share when it actually produced earnings of $0.61, delivering a surprise of -27.38%.Over the last four quarters, ...

MGE (MGEE) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended March 2025. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may mov ...

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Core Viewpoint - MGE's quarterly earnings of $0.61 per share fell short of the Zacks Consensus Estimate of $0.84 per share, marking a -27.38% earnings surprise, despite an increase from $0.55 per share a year ago [1][2] Financial Performance - MGE reported revenues of $171.42 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 2.71%, compared to $164.65 million in the same quarter last year [2] - Over the last four quarters, MGE has not surpassed consensus EPS estimates and has only topped revenue estimates once [2] Stock Performance - MGE shares have declined approximately 1% since the beginning of the year, while the S&P 500 has gained 1.7% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.96 on revenues of $198.17 million, and for the current fiscal year, it is $3.84 on revenues of $707.88 million [7] - The trend of estimate revisions for MGE is mixed, which could change following the recent earnings report [6] Industry Context - The Utility - Electric Power industry is currently in the top 50% of over 250 Zacks industries, suggesting that stocks in this category tend to outperform those in the bottom 50% by more than 2 to 1 [8]

Financial Performance - MGE Energy's GAAP earnings for the full year of 2024 were $120.6 million, or $3.33 per share, representing an increase from $117.7 million, or $3.25 per share, in 2023[1] - For Q4 2024, MGE Energy reported earnings of $22.0 million, or 61 cents per share, up from $20.1 million, or 55 cents per share, in Q4 2023[2] - Operating revenues for the full year of 2024 were $676.9 million, a decrease from $690.4 million in 2023[6] - Operating income for the full year of 2024 was $146.3 million, slightly down from $146.4 million in 2023[6] - The weighted average shares outstanding for basic earnings per share in 2024 were 36,210 thousand, compared to 36,163 thousand in 2023[6] Customer Base - MGE Energy serves 167,000 electricity customers and 178,000 natural gas customers in Wisconsin[7] Renewable Energy Initiatives - MGE Energy completed the Paris solar project in December 2024, contributing to its renewable generation investments[2] - The company continues to focus on cost-effective renewable generation to support asset growth and increase electric earnings[2] Market Conditions - Gas retail therm deliveries decreased approximately 4% in 2024 compared to the prior year, primarily due to warmer-than-normal weather[3] Forward-Looking Statements - MGE Energy cautions that forward-looking statements are based on current expectations and are subject to risks and uncertainties[8]

Electric Operations and Revenue - MGE Energy's electric operations accounted for approximately 74%, 71%, and 65% of total regulated revenues in 2024, 2023, and 2022 respectively[27]. - As of December 31, 2024, MGE supplied electric service to approximately 167,000 customers, with 91% located in urban areas[26]. - MGE's electric operations include regulated electric and gas utility operations, as well as nonregulated energy operations[26]. - Gas operations accounted for approximately 26%, 29%, and 35% of MGE's total regulated revenues in 2024, 2023, and 2022, respectively[49]. - No single customer accounted for more than 10% of total operating revenues for MGE Energy and MGE in 2024[281]. Carbon Reduction and Renewable Energy Goals - MGE aims for a net-zero carbon electricity target by 2050 and has committed to achieving at least 80% carbon reductions by 2030 from 2005 levels[36]. - MGE's carbon reduction goals align with the recommendations of the Intergovernmental Panel on Climate Change (IPCC)[37]. - MGE plans to eliminate coal as an owned generation source by the end of 2032, reducing approximately two-thirds of its current coal-fired generation capacity by 2030[39]. - MGE is working to increase renewable energy to 25% of retail electric sales by 2025 and to 30% by 2030[72]. - MGE currently exceeds Wisconsin's renewable energy requirement of approximately 8%[81]. Transition from Coal and Natural Gas - The company is transitioning away from coal and adding new renewable generation to meet its carbon reduction goals[38]. - MGE plans to retire the Columbia unit by the end of 2029 and transition the Elm Road Units from coal to natural gas by the end of 2032[72]. - MGE purchased 25 MW in the West Riverside Energy Center in early 2023 and an additional 25 MW in June 2024, as part of its investment in natural gas plants[45]. Renewable Energy Projects and Initiatives - Since 2015, MGE has added 222 MW of solar and 93 MW of wind generation facilities, with an expectation to add approximately 178 MW of solar, 18 MW of wind, and 118 MW of battery storage by the end of 2028[40]. - MGE has developed approximately 42 MW of solar generation under the Renewable Energy Rider (RER) program, partnering with large energy users[43]. - The Shared Solar Program allows residential and small business customers to use locally generated solar energy for up to half of their annual energy needs, with a total capacity of 4 MW from two solar facilities[44]. - MGE's 19% share in the Columbia Energy Storage project will be 3 MW, which is set to be the first of its kind in the United States if approved[41]. Emission Reduction and Environmental Compliance - MGE aims to achieve net-zero methane emissions from its natural gas distribution system by 2035, introducing a renewable natural gas program in May 2024[51]. - The EPA finalized a rule to lower the average annual PM2.5 NAAQS from 12 ug/m3 to 9 ug/m3, effective May 2024, which may impact Milwaukee County[67]. - The EPA's final performance standards under section 111(b) of the Clean Air Act for carbon dioxide emissions will require states to submit plans for existing natural gas-fired combustion turbines within two years[74]. Workforce and Safety - As of December 31, 2024, MGE Energy had 717 employees, with women and ethnic minorities representing 25% and 10% of the workforce, respectively[82]. - MGE has implemented a comprehensive safety culture involving employees at all levels to enhance workplace safety[87]. Financial Management and Risk - MGE manages market risks associated with interest rates, commodity prices, and equity returns through risk management policies and derivative instruments[270]. - MGE expects to recover $72.3 million in fuel and purchased power costs in 2025, subject to PSCW fuel rules[272]. - As of December 31, 2024, the fair value of exchange-traded derivatives and financial transmission rights (FTRs) exceeded the cost basis by $0.1 million[275]. - A 1% reduction in the expected rate of return on pension plan assets would increase annual pension costs by approximately $4.4 million before taxes[277]. - The value of employee benefit plans trusts' assets increased by approximately 11% in 2024 and 15% in 2023[277]. - MGE manages credit risk through established credit policies, including credit approval processes and counterparty limits[278]. - MGE's cash and cash equivalents are placed with high credit-quality financial institutions to mitigate credit risk[282]. - MGE employs physical contracts and financial derivative contracts to reduce price risk from market fluctuations[274]. - Assuming a 1% change in average interest rates, 2024 interest expense and net income would have increased/decreased by $0.4 million for both MGE Energy and MGE[276].

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分组1 - MGE reported quarterly earnings of $1.13 per share, missing the Zacks Consensus Estimate of $1.17 per share, but showing an increase from $1.05 per share a year ago, resulting in an earnings surprise of -3.42% [1] - The company posted revenues of $168.48 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 2.85%, compared to year-ago revenues of $160.53 million [2] - MGE shares have increased approximately 25.6% since the beginning of the year, outperforming the S&P 500's gain of 21.2% [3] 分组2 - The current consensus EPS estimate for the coming quarter is $0.64 on revenues of $167.94 million, and for the current fiscal year, it is $3.69 on revenues of $674.38 million [7] - The Zacks Industry Rank for Utility - Electric Power is currently in the top 39% of over 250 Zacks industries, indicating a favorable outlook for the industry [8] 分组3 - The estimate revisions trend for MGE is mixed, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it is expected to perform in line with the market in the near future [6] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Earnings Announcement - MGE Energy, Inc. announced its third quarter 2024 earnings on November 6, 2024[4]. - The press release regarding the earnings announcement is included as Exhibit 99.1[3]. Company Information - The company is registered on the NASDAQ Stock Market under the common stock with a par value of $1 per share[2]. Financial Reporting - No financial statements of businesses acquired or pro forma financial information were reported in this filing[6]. - The report was signed by Jenny L. Lagerwall, Assistant Vice President - Accounting and Controller[8].

Financial Performance - MGE Energy's earnings for the three months ended September 30, 2024, were $40.9 million or $1.13 per share, an increase from $37.9 million or $1.05 per share in the same period last year, reflecting a 7.9% year-over-year growth [108]. - For the nine months ended September 30, 2024, MGE Energy's earnings were $98.5 million or $2.72 per share, compared to $97.6 million or $2.70 per share in the prior year, indicating a slight increase of 0.9% [108]. - Electric revenue increased by $8.9 million to $147.79 million for the three months ended September 30, 2024, compared to $138.89 million in the same period of 2023, representing a 6.4% increase [130]. - Electric revenue increased by $6.7 million (1.8%) during the nine months ended September 30, 2024, compared to the same period in 2023, totaling $384.3 million [153]. - Gas revenue decreased by $26.9 million (18.2%) during the nine months ended September 30, 2024, totaling $120.8 million, primarily due to a decrease in volume and lower average rates [162]. - MGE Energy's cash provided by operating activities for the nine months ended September 30, 2024, was $209.8 million, an increase from $194.0 million in 2023 [183]. - MGE Energy's cash used for investing activities increased by $11.1 million during the nine months ended September 30, 2024, compared to the same period in the prior year [185]. - MGE's cash flows from financing activities increased by $0.4 million during the nine months ended September 30, 2024, compared to the same period in 2023 [198]. Segment Performance - Electric utility segment earnings for the three months ended September 30, 2024, were $35.0 million, up from $31.1 million in the same period last year, while gas utility segment earnings decreased to $(2.0) million from $(0.8) million [110]. - Gas retail sales decreased approximately 7% due to warmer than normal weather, with heating degree days down by approximately 9% in the first nine months of 2024 compared to the prior year [112]. - Total retail electric sales decreased slightly by 0.1% to 902,615 kWh in Q3 2024 from 903,147 kWh in Q3 2023 [130]. - Residential electric sales decreased by approximately 2% due to warmer weather conditions, impacting sales volumes [157]. - Total retail electric sales volume decreased by 0.3% during the nine months ended September 30, 2024, totaling 2,411,901 kWh [153]. Rate Changes - The PSCW approved a 1.54% increase to electric rates and a 2.44% increase to gas rates for 2024, with further increases planned for 2025 [113]. - The PSCW authorized a 1.54% increase in retail electric rates effective December 2023, contributing to higher revenues [154]. - The average retail rate per therm for gas customers decreased approximately 2% to $1.246 in Q3 2024 compared to $1.270 in Q3 2023 [139]. - The average retail rate per therm for gas customers decreased approximately 12% compared to the same period in the prior year, reflecting lower natural gas commodity costs [165]. Operational Expenses - Consolidated operations and maintenance expenses increased by $3.1 million, driven by higher customer accounts costs and transmission costs [141]. - Operations and maintenance expenses increased by $11.8 million during the nine months ended September 30, 2024, driven by increased customer accounts costs and transmission costs [168]. - Electric depreciation expense rose by $1.5 million in Q3 2024, attributed to the placement of Badger Hollow II in service in December 2023 [146]. - Electric depreciation expense increased by $4.7 million due to the addition of new generating facilities, including Badger Hollow II, which went online in December 2023 [172]. Renewable Energy Initiatives - MGE Energy is targeting an 80% carbon reduction by 2030 from 2005 levels, with plans to transition away from coal and increase renewable generation [121]. - MGE has acquired a joint interest in several renewable generation projects, forecasting capital expenditures for 198 MW of solar, 97 MW of battery, and 18 MW of wind [124]. - MGE aims to achieve net-zero methane emissions from its natural gas distribution system by 2035, introducing a renewable natural gas program effective May 2024 [125]. - MGE is monitoring potential disruptions in solar procurement due to new tariffs and regulations, which may impact costs and timelines for current and future projects [126]. - MGE holds a 19% ownership interest in the Columbia Energy Storage Project, which is currently under development [194]. Capital Expenditures - Capital expenditures for MGE Energy during the nine months ended September 30, 2024, were $164.1 million, reflecting an increase of $13.8 million from the prior year [186]. - MGE Energy's forecasted total capital expenditures for 2024 are projected to be $226.0 million, increasing to $312.0 million by 2029 [189]. - MGE's forecasted capital expenditures for electric and gas distribution from 2024 to 2029 are approximately $57 million, focusing on enhanced metering solutions [196]. Other Income and Investments - Nonregulated energy operations net income increased to $6.1 million in Q3 2024 from $5.6 million in Q3 2023 [148]. - Nonregulated energy operations net income increased to $18.0 million for the nine months ended September 30, 2024, compared to $16.7 million in the prior year [174]. - The transmission investment segment reported other income of $2.9 million in Q3 2024, up from $2.7 million in Q3 2023 [149]. - Other income from the transmission investment segment increased to $8.4 million in the nine months ended September 30, 2024, compared to $7.9 million in the same period of 2023 [175]. - MGE derived approximately 6.0% of its net income from its investment in ATC during the nine months ended September 30, 2024 [208]. Tax and Liquidity - The effective tax rate reconciliation is detailed in the financial statements, reflecting the company's tax obligations [177]. - MGE Energy expects to have adequate liquidity to support future operations and capital expenditures over the next twelve months [182]. - MGE's common shareholders' equity ratio increased to 60.8% as of September 30, 2024, compared to 59.9% at the end of 2023 [199]. Regulatory Changes - The FERC ruling in October 2024 resulted in a 4-basis point reduction in the base ROE from 10.02% to 9.98% [175]. - The company expects potential procurement disruptions to impact costs and timelines for solar projects, necessitating notifications to the PSCW for cost recovery [193][210].