Otter Tail Corporation (NASDAQ: OTTR) has announced its financial results for the quarter ended September 30, 2024. The company's diluted earnings per share decreased by 7% to $2.03 compared to the third quarter of 2023. However, the midpoint of the 2024 earnings guidance has been increased by $0.15 to $7.07 per share.
The return on equity over the trailing twelve months stands at 20%. Otter Tail Power, the company's electric segment, saw a 16% increase in earnings, primarily due to the impact of interim rates in North Dakota and a federal energy regulatory commission ruling on transmission owner returns on equity. On the other hand, the manufacturing segment experienced a 71% decrease in earnings, largely due to lower sales volumes.
The plastics segment, despite a decrease in earnings compared to the same period last year, has been performing better than anticipated, capitalizing on customer sales volume growth. Sales prices of PVC pipe continue to decline, but at a slower rate than expected. The first phase of the expansion project at Vinyltech in Arizona is nearly complete, with the anticipation of adding large diameter PVC pipe production capability at this location later this year.
Otter Tail Corporation has increased and tightened its 2024 diluted earnings per share guidance to a range of $6.97 to $7.17 from the previous range of $6.77 to $7.07. The corporation's board of directors declared a quarterly common stock dividend of $0.4675 per share, payable on December 10, 2024, to shareholders of record on November 15, 2024.
In terms of liquidity, the company's total available liquidity was $544 million as of September 30, 2024. Consolidated cash provided by operating activities for the nine months ended September 30, 2024, was $322.8 million, compared to $318.5 million for the same period in 2023.
Segment performance highlights include a 16.1% increase in net income for the electric segment, a 20.6% decrease in operating revenues for the manufacturing segment, and a 0.6% increase in operating revenues for the plastics segment. The corporate segment saw a 63.0% decrease in net income.
Looking ahead, Otter Tail Corporation is increasing its 2024 diluted earnings per share guidance range and expects its earnings mix to be approximately 30% from the electric segment and 70% from the manufacturing and plastics segments, net of corporate costs.
As a result of these announcements, the company's shares have moved 5.1% on the market, and are now trading at a price of $82.5. For more information, read the company's full 8-K submission here.
