MDU Resources Group - Q1 2023

Transcript

Operator (participant)

Hello, my name is Marjorie, and I'll be your conference facilitator. At this time, I'd like to welcome everyone to the MDU Resources Group 2023 first quarter conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer period. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypads. If you would like to withdraw your question, please press star two on your telephone keypad. The webcast can be accessed at www.mdu.com under the investor relations heading. Select Events and Presentations and click Q1 2023 Earnings Conference Call. After the conclusion of the webcast, a replay will be available at the same location.

I would now like to turn the conference over to Jason Vollmer, Vice President and Chief Financial Officer of MDU Resources Group. Thank you, Mr. Vollmer. You may begin.

Jason Vollmer (CFO)

Thank you, Marjorie, and thanks everyone for joining us on our first quarter 2023 earnings conference call. You can find our earnings release and supplemental materials for this call on our website at www.mdu.com under the investor relations tab. Leading today's discussion along with me will be Dave Goodin, President and CEO of MDU Resources. Also with us today to answer questions following our prepared remarks are Stephanie Barth, Vice President, Chief Accounting Officer, and Controller of MDU Resources, Brian Gray, President and CEO of Knife River Corporation, Jeff Thiede, President and CEO of MDU Construction Services Group, Trevor Hastings, President and CEO of WBI Energy, and Nicole Kivisto, President and CEO of our utility group. During our call, we will make certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934.

Although the company believes that its expectations and beliefs are based on reasonable assumptions, actual results may differ materially. For more information about the risks and uncertainties that could cause our actual results to vary from any forward-looking statements, please refer to our most recent SEC filings. We may also refer to certain non-GAAP information. For reconciliation of any non-GAAP information to the appropriate GAAP metric, please reference our earnings release. This morning, we announced that MDU Resources' Board of Directors approved the previously announced spin-off of Knife River effective May 31st. Dave will provide more details of the separation later in the call, and additional information can be accessed on our website. It's an exciting time for both Knife River and MDU Resources as we progress towards our objective of creating two pure play publicly traded companies.

I'll provide consolidated financial results for the first quarter before handing the call over to Dave Goodin for his comments, forward look, and update on our strategic initiatives. This morning, we announced our first quarter earnings of $38.3 million or $0.19 per share on a GAAP basis, with adjusted earnings of $46.6 million or $0.23 per share compared to first quarter 2022 GAAP earnings of $31.7 million or $0.16 per share. With the announcement of Knife River separation and continued work on the strategic review of our construction services business, we are reporting adjusted earnings that exclude costs related to these strategic initiatives. Our combined utility business reported earnings of $55.5 million for the quarter compared to earnings of $47.6 million for the first quarter in 2022.

The electric utility segment reported first quarter earnings of $16.6 million compared to $11.3 million for the same period in 2022. The increase was largely the result of interim rate relief in North Dakota and Montana and lower operation and maintenance expense associated with the closure of coal-fired generating units one and two at Heskett Station in early 2022. The business also experienced higher investment returns on non-qualified benefit plans. Our natural gas utility segment reported first quarter earnings of $38.9 million compared to $36.3 million in the first quarter of 2022. Revenues increased primarily as a result of approved rate relief in Washington and a 4.2% increase in retail sales volumes to all customer classes due to colder weather.

Weather impacts were partially offset by weather normalization and decoupling mechanisms and a gas cost-sharing mechanism in Oregon. The business also benefited from increased investment returns on non-qualified benefit plans during the quarter, partially offset by higher operation and maintenance expense and higher net interest expense. The pipeline business earned $8.3 million in the first quarter compared to $7.3 million in the first quarter of 2022. The improvement was driven by higher transportation revenue, largely due to a full first quarter of benefit from the North Bakken expansion project that was placed in service in February of 2022, as well as its increased contracted volume commitments starting February of this year. The business experienced record first quarter transportation volumes. The increase was offset in part by higher operation and maintenance expense due to payroll-related costs and legal fees associated with the pending FERC rate case.

In addition, interest expense and depreciation expense increased largely related to the North Bakken expansion project. Construction services reported all-time record quarterly revenue of $754.3 million in the first quarter and first quarter earnings of $26.1 million, compared to revenue of $552.6 million and earnings of $21.3 million for the same period in 2022. EBITDA increased $8.7 million in the first quarter compared to last year. Business saw increased electrical and mechanical revenue due to increased commercial, industrial, and institutional workloads. Transmission and distribution revenues increased slightly year-over-year, primarily related to storm work, and were partially offset by lower transportation workloads, in particular for street lighting projects.

While revenues increased, the business experienced a decrease in margins due to higher overall operating costs, largely related to inflationary pressures, including costs for labor, subcontractors, and equipment. In addition, margins were impacted by losses on certain projects. Finally, our construction materials business reported first quarter revenue of $307.9 million and a seasonal loss of $41.3 million, compared to prior year first quarter revenue of $310 million and a seasonal loss of $40 million. EBITDA increased $4.1 million in the first quarter compared to 2022. In response to inflation, the business has raised average product pricing across its product lines, which contributed to increased margins. The business was negatively impacted by unfavorable weather across most regions, and in particular, the Pacific region, resulting in decreased volumes for certain products, including ready-mix concrete and asphalt.

Increased aggregate revenue and margins offset some of the weather impacts, largely due to higher average selling prices and higher demand in the Northwest region. Business continues to be impacted by inflation across all regions, with the largest impacts from cement, labor, natural gas and diesel. Results at each of our businesses were positively impacted in the first quarter on a non-cash basis by higher investment returns on non-qualified benefit plans. Collectively, the positive earnings variance was approximately $9.1 million or $0.04 per share compared to first quarter of 2022. This change in investment returns is due to fluctuations in the financial markets. That summarizes the financial highlights for the first quarter. Now I'll turn the call over to Dave for his formal remarks. Dave?

David Goodin (President and CEO)

Thank you, Jason, and thank you everyone for spending time with us today and for your continued interest in MDU Resources. We are pleased with our strong first quarter results. Our utility and natural gas pipeline businesses continue to perform well. The utility business was positively impacted by rate relief and higher natural gas volumes due to colder weather in many of its regions. While the colder weather was a benefit to the regulated businesses and construction services experienced increased workloads from storm-related work, our construction materials businesses experienced unfavorable weather throughout the first quarter, which delayed the start of our construction season in many parts. We are beginning to see the benefits from price increases, which is helping offset inflationary pressures. Our combined construction businesses reported record first quarter backlog.

The businesses have secured additional projects to replace backlog projects that have been completed or are nearing the end of their project life cycle. To summarize activity by business segment, I'll start off with the regulated energy delivery businesses. The utility reported increased earnings on a combined basis for the quarter, driven by rate relief in certain electric and natural gas jurisdictions. Natural gas retail sales volumes were 4.2% higher, and electric retail sales volumes were 3.3% higher than the first quarter last year. The company is constructing our Heskett Unit four, an 88 MW natural gas-fired electric generating facility near Mandan, North Dakota, just across the river, and we expect this to be operational this summer.

We also continue to expect our rate base to grow between 6% and 7% compounded annually over the next five years, driven primarily by investments in system infrastructure upgrades and replacements to safely meet customer demand. This business reached settlements in the North Dakota Electric and Idaho Natural Gas Rate cases and continues to seek regulatory recovery for the investments associated with providing safe and reliable electric and natural gas service to our growing customer base. At our pipeline business, we had record first quarter transportation volumes. As Jason noted, this business recorded higher transportation revenues, largely due to the first full quarter of benefit from our North Bakken expansion project, which was placed into service in February of 2022, and increased volume commitments which began here recently in February of 2023.

The company filed a rate case on January 27th with the Federal Energy Regulatory Commission, in which it is seeking rate increases for its transportation and storage services. The new rates, pending FERC approval, will take effect August 1st. The company expects to be in construction in the second quarter on three natural gas pipeline expansion projects that are anticipated to be in service later in 2023. These will add approximately 300 million cubic feet per day of incremental capacity. Our regulated energy delivery businesses performed well in the first quarter, and we are reaffirming earnings guidance for the regulated businesses to be in the range of $140 million to $150 million. I'd like to move on to our construction businesses. Our Construction Services Group had an all-time record quarterly revenue.

We experienced strong demand for electrical and mechanical-related work, with an increase in revenues of approximately 50%, specifically for high tech and hospitality-related construction services during the quarter. Margins were impacted by higher labor costs and higher interest rates negatively impacting results. Construction services ended the quarter with record first quarter backlog. We are well positioned to complete these projects safely and efficiently with our ability to attract and retain a skilled workforce, now exceeding 9,000 employees across our footprint. Given the strong start to the year, we are increasing our 2022 revenue guidance range, $50 million on both the bottom and the top end to be now at $2.8 billion to $3 billion. We expect slightly higher margins compared to 2022 and our EBITDA in the range between $200 million to $225 million.

At our construction materials business, we increased EBITDA here $4.1 million when compared to the same period in 2022. The business experienced delays from unfavorable weather conditions across the majority of Knife River's markets. Higher product pricing partially offset these delays. The company reported a record first quarter contracting services backlog, increasing approximately 23% since the same time last year. Given the strong backlog and the successful bidding process, we are affirming the revenue guidance range to be between $2.5 billion and $2.7 billion here in 2023, with higher margins compared to 2022. We also note that our EBITDA is expected to be in the range between $300 million and $350 million. Looking forward, both of our construction businesses are well-positioned to benefit from increased bidding opportunities.

With the funding from the Infrastructure Investment and Jobs Act, along with the Inflation Reduction Act and additional state funding, our construction businesses will see increased demand in 2023 and beyond for the work they already excel in doing. As we look ahead, we are encouraged by our opportunities for customer growth in our electric and natural gas businesses, a robust set of pipeline projects, ongoing system growth, and steady demand for pipeline services, along with high demand, as I've noted, for our construction service business. We are excited to share the news today that the MDU Resources board of directors approved the separation of Knife River. The spin-off is expected to be completed at 11:59 P.M. Eastern Daylight Time on May 31st. The distribution is expected to be tax-free for MDU Resources stockholders for U.S. federal income tax purposes.

Stockholders will retain their current shares of MDU Resources stock, and on May 31st will receive a distribution of one share of Knife River stock for every four shares of MDU Resources stock owned as of May 22nd, 2023, which is the record date for the distribution. Upon completion of the distribution, MDU Resources will continue to trade in the regular way on the New York Stock Exchange under our ticker symbol MDU, and Knife River will trade in the regular way on the NYSE under the ticker symbol KNF. In connection with the anticipated separation of Knife River, an Investor Day is also planned for May 18th at the stock exchange. Knife River management will present Knife River's investment highlights, operations, financial performance, along with growth prospects, along with a question-and-answer session. The presentation will also be webcast.

Please visit the MDU website for more details on the Knife River separation, along with our in-depth Investor Day again planned for this May 18th. In addition to the Knife River separation and to achieve our objective of creating two pure-play public companies, we also announced in November last year that the MDU Resources was undertaking a strategic review of our construction service business. We are on track to complete this review here in the second quarter of 2023. We also announced today the board of directors declared a quarterly dividend on the company's common stock of $0.2225 per share, unchanged from the previous quarter. The dividend is payable July 1st to stockholders of record on June 13th.

Following the spin-off of Knife River, MDU Resources' board of directors expects to review our dividend practice with the intent to align payout relative to regulated energy delivery earnings with pure-play peer companies. Any changes that result from the review will apply to future periods and will not impact the quarterly dividend to be paid here on July 1st. The board of directors for Knife River will be responsible for developing any future dividend practice for Knife River. As always, MDU Resources is committed to operating with integrity and with a focus on safely providing superior shareholder value as we continue to provide essential services to our customers and delivering on our mission of building a strong America while being a great and safe place to work. I appreciate your interest in and your commitment to MDU Resources and ask now that we open the lines to questions. Operator?

Operator (participant)

Thank you very much. As a reminder, ladies and gentlemen, that is star one for a question. We'll take our first question from Ryan Levine from Citi. Please go ahead.

Ryan Levine (Equity Analyst)

Hi, everybody.

David Goodin (President and CEO)

Hi, Ryan.

Ryan Levine (Equity Analyst)

Thanks for all the detail today. I guess a few questions. One, in terms of the construction materials performance during the quarter, noticed some of the ready-mix volumes were light versus history. Any color as to what drove that? Was it weather or were there other factors that were at play?

David Goodin (President and CEO)

Yep. Ryan, perfect question. Certainly, weather did have a negative effect, on our Knife River operations. I'll ask Brian Gray to give more detailed color on that, though.

Brian Gray (President and CEO)

Thanks, Dave, and thanks, Ryan. Yeah, our volumes were down about 24% in ready-mix. Like, you mentioned, weather had a big impact on that. Our rain in California, the record snowfalls in, you know, Bismarck or North Dakota, Wyoming, Montana, Minnesota.

All had an impact on that. The other thing that plays into that is we sold our Beaumont operations at the end of last year, and that was a ready-mix facility down there in Texas. That had the impact. Really the last thing is the softening of the residential market is impacting our ready-mix business the most. Really is those three things, Ryan.

Ryan Levine (Equity Analyst)

Appreciate that. Then in terms of construction service strategic alternatives, you highlighted continued expectations to reach a decision by the end of the quarter. Does that imply that you're prepared to monetize the asset within the next couple of months? Could a decision include, keeping it as part of the portfolio?

David Goodin (President and CEO)

Yeah, Ryan. Really what we've said, and what I'll reinforce today is that it's the review we expect to be completed here in the second quarter. I think you're jumping ahead with what could be some conclusions or some hypotheticals there. I won't go there, but expect to get an update on or before probably our second quarter earnings release.

Ryan Levine (Equity Analyst)

Okay. In terms of the Knife River spin itself, the recent filing seems to suggest a smaller retained equity position for MDU than some of the previous filings. How are you thinking about what the right level of equity that MDU will hold in the go-forward entity in the interim and then longer term?

David Goodin (President and CEO)

Yep. Spot on, Ryan. Yes, we've indicated 10% so far as retained shares at MDU. I'll ask Jason to maybe give a little color there. The short answer, it's about balance. Jason, maybe a little more detail.

Jason Vollmer (CFO)

Yeah. Thanks. Ryan, good to catch up with you. Yes, as David mentioned, we have reflected in our most recent filing of the Form 10, approximately 10% retained stake versus 19.9%, which we had talked about earlier within that. Again, when you think about the timing of the spin for Knife River here at the end of May, it really gets to be towards the peak of its working capital cycle on a seasonal basis. That working capital obviously is being incurred right now under the MDU Resources balance sheet here. After the spin, Knife River will get the benefit of the cash flowing back as they complete construction projects and bill that out to their customers and work through that process.

It's really about balancing the appropriate capital structure for both of these businesses post-spin to make sure that both Knife River and MDU Resources have a strong balance sheet and a strong ability to continue their growth prospects after this. It's really more of a balancing mechanism on that than it is anything else.

Ryan Levine (Equity Analyst)

Last question from me. In terms of construction service opportunities for undergrounding, we're hearing more utilities look to initiate acceleration of undergrounding work around the country. Is MDU pursuing opportunities throughout the country or more selective in certain geographies?

David Goodin (President and CEO)

Yep. Thanks, Ryan. I'll ask Jeff Thiede to weigh in on that. He'll probably expound on the fact of our $2.1 billion in backlog there, across the services group. Jeff, specific to undergrounding, which is Ryan's question.

Jeffrey Thiede (President and CEO)

Yeah, thanks, Ryan, for the question. You know, we've been pre-qualified for one of our utility customers, and we're seeing packages be released. We have the experience in working with this particular customer for decades, and we rate high on their KPIs. We're very well-positioned, and we expect to get quite a bit of this work. We are doing some of this undergrounding work in Southern California as well, and we see an increase in those opportunities going forward. We're seeing some of the Pacific Northwest with undergrounding of services, power, communications, gas. As right-of-ways and engineering gets completed, those packages are available.

We certainly have that in our line of sight, and we expect to get some of that work, and it falls right into our wheelhouse of what we've done in the past and what we're able to be successful in the future.

Ryan Levine (Equity Analyst)

Thank you. Appreciate the color.

David Goodin (President and CEO)

Thank you, Ryan.

Operator (participant)

We'll take our next question from Brian Russo from Sidoti.

Brian Russo (Stock Analyst)

Hi, good afternoon.

David Goodin (President and CEO)

Hi, Brian.

Brian Russo (Stock Analyst)

Just focus on the utility. You noted the North Dakota electric settlement. Correct me if I'm wrong, did you also say you reached a settlement in Idaho as well?

David Goodin (President and CEO)

That is correct. Nicole?

Nicole Kivisto (President and CEO)

Yep. Yeah, you did hear that correctly. We have an all-party settlement there that we will file. We have not filed it yet with the Commission, it'd be in front of the Commission for approval. We hope to file that this week. We have a settlement in front there.

Brian Russo (Stock Analyst)

Okay, great. Mm-hmm. Okay, great. I think you also had plans for several other rate cases to be filed. I think both in electric and gas in South Dakota, and then a gas case in North Dakota, and then another gas case in Washington. Just wondering what the status are of those four cases?

Nicole Kivisto (President and CEO)

You hit it exactly right. All of those are still on the radar here for 2023. We expect to get those filings out in 2023. Washington, the only thing I would add to what you mentioned there is Washington would be a multi-year case.

Brian Russo (Stock Analyst)

Okay, great. On Knife River, just could you just talk about the weather impact maybe on the contracting services side of the business? You know, projects that were delayed but not canceled, you know, maybe a $ amount that gets pushed into later in the year. Were you also involved or actively involved in any storm restoration?

Brian Gray (President and CEO)

Yep. Brian, this is Brian. Yes. We had, you know, a lot of rain in California, and so that had a huge. Probably the biggest impact. The first quarter for us, you know, in construction revenue is always slow because of our geographic footprint. Typically on the West Coast, we're able to work. In California, because of the soil conditions and the amount of rain that they had, you know, they had 13 in of rain last year. For the first quarter, they had a drought going on. They had less than 1 in last year. This year, more than 13 in. In terms of revenue, in California specifically, we lost about 75% of our days that we could do contracting services, due to the weather.

You know, in the North Central region, Montana, Wyoming, North Dakota, Minnesota, they're typically down those months. Really the impact came from in California. We are seeing, I think, you know, with the hot temperatures now and the amount of snow up in the Sierras, that there is some flooding and fully expect it will benefit from some, you know, flood restoration and some storm repair work. We don't have anything, you know, this material on our books, as far as that type of weather repairs right now, but we are expecting to see some of that come.

Brian Russo (Stock Analyst)

Okay, great.

[crosstalk

Brian Gray (President and CEO)

As far as the work that we did get done, you know, we've looked at our backlog. It's a record backlog of $950 million. Even though we did have a slow start on the West Coast and, you know, the normal start that we have in the North Central regions, definitely, we have the crews and capacity to get that backlog of work done, and we did not see any cancellations of our backlog projects.

Brian Russo (Stock Analyst)

Okay, great. Just on construction services and the backlog as of March, have you burned through or completed most of the projects that were generating lower margins, you know, due to the, you know, rapid inflation we saw throughout 2022? As we move forward throughout the year, we could see, you know, year-over-year quarterly margin improvements in that business.

Jeffrey Thiede (President and CEO)

Yeah. Brian.

David Goodin (President and CEO)

Jeff, can you take that one?

Jeffrey Thiede (President and CEO)

Certainly.

David Goodin (President and CEO)

Go ahead.

Jeffrey Thiede (President and CEO)

We've had some issues, of course, with the inflationary pressures on labor, materials, subcontractors. We've had a couple of projects that we've had some challenges on, but we're working on and well underway on entitlement recovery and equitable adjustment for those projects, which could bode well in future periods. We're building our record backlog. We're seeing a lot of consistency in how our markets were in 2022 versus 2023. Our commercial market is the strongest, which contains our entertainment, gaming, and hospitality and mission-critical. We're seeing incredible demand for our services in those, in those areas. Our transportation market has also increased as a percentage of our backlog, largely due to two key projects in Kansas City. There's a streetcar extension project and a U.S. 69 expressway project. We're involved in a 9-mile, 2-lane expansion.

If you take a look at our top 10 list of our backlog, they come from five of our companies. In our top 10 list, we've got hospitality and gaming, of course, probably as expected, an entertainment project, mission-critical, data center projects, an airport project, healthcare project, and a government services project in the Mid-Atlantic. Those last two projects are from our company that was mostly recently acquired as we're starting to see their contribution grow. We're pulling through some of these challenges that we've had with pandemic and inflation and supply chain, and our margins going forward should improve as well.

Brian Russo (Stock Analyst)

Okay, great. Thank you very much.

David Goodin (President and CEO)

Thank you, Brian.

Operator (participant)

Thank you. Next, we'll go to Brent Thielman from D.A. Davidson.

Brent Thielman (Managing Director and Senior Research Analyst)

Hey, thank you, and congrats on all the progress on the strategic changes here.

David Goodin (President and CEO)

Thank you very much, Brent.

Brent Thielman (Managing Director and Senior Research Analyst)

Yeah. Thanks, Dave. I guess first question just on CSG. Just the thoughts on the quality of new work added. It seems like really high levels of demand relative to what you're seeing, where I think you'd be able to be more selective. I'm just wondering if you're able to build in kind of better contingencies in the contracts to counteract any kind of future potential inflation and supply chain issues that may come about, how those negotiations are going within CSG Group?

David Goodin (President and CEO)

Yeah. Jeff?

Jeffrey Thiede (President and CEO)

You bet. Yeah. As we continue to be involved in pre-construction, we get involved with the architect, the engineers, the general contractor on these jobs. We're able to work closely with our suppliers and mitigate a lot of these issues with the potential delays and availability of equipment, commodities, materials. As we continue to see our backlog grow to record levels and these projects still available for us, we have been more selective. It's tough to say no on some opportunities, but we are gonna continue to grow our business grow our record employment levels be very selective and take those calculated risks so we can build upon our record performance in 2022.

Brent Thielman (Managing Director and Senior Research Analyst)

Okay. I appreciate that. Really strong results and growth in terms of the commercial, industrial, institutional pieces of the business. Maybe just your thoughts on the potential, I guess for the renewables business line. Seems like that could be much more important piece of the overall pie down the road, but maybe you're managing the growth a little more carefully. Just curious your thoughts there.

Jeffrey Thiede (President and CEO)

You know, we're, we have a couple of really exciting projects out of one of our companies in the Midwest that we're underway on, and we've got another project in Las Vegas that we've got over 200 people working in installing renewable products that our customers asked us to come in and, and help out on. We've got experience in the electric vehicle manufacturing facilities, EV charging stations. We've done hundreds of those. Of course, as I mentioned, the solar work. This is gonna put us in a good position for future renewable projects, IIJA and IRA contract awards, and that's gonna contribute to our momentum.

Brent Thielman (Managing Director and Senior Research Analyst)

Okay. Appreciate that, Jeff. Just one more, if I could, on Knife River. I mean, substantial uptick in backlog here this quarter. I'd be interested if the majority of this is public works related due to infrastructure work, you know, maybe how the other non-residential end markets look and the geographies you play in. Lastly, just I guess your customers receptiveness to price increases. There's been a lot pushed out there in the market and whether that's still a lever that you think you can control this year.

Brian Gray (President and CEO)

Yeah, Brent, I'll take this. This is Brian. Yeah, our backlog continues to grow. We're at the $959 million of a record backlog, and it has been towards the public works projects. Last year, you know, of the $1.2 billion of contracting services work that we did, 78% of that was public funded. This year, our backlog right now is at 83%. We are seeing that grow and benefiting from the just the multiple different sources of public infrastructure funding. We are seeing that. We can be more selective because we have that record backlog, which has been good, and that's improved our margins that's on our backlog.

As far as, you know, the price increases, we did see and had a very good success at implementing new price increases this year, and that's on top of several increases from last year. You know, quarter-over-quarter, our aggregate prices are up about 10%, ready mix is up about 17%, and asphalt prices, even though we didn't do a lot of production in asphalt, those prices are up 33% year-over-year. Definitely, see some traction with our price increases in the market.

Brent Thielman (Managing Director and Senior Research Analyst)

Okay. Thanks, Brian. Thanks all. Appreciate it.

Jeffrey Thiede (President and CEO)

Thank you, Brent.

Operator (participant)

As a reminder, ladies and gentlemen, that is star one for a question. Having no further questions, I'd like to turn it back to our speakers for any closing remarks.

David Goodin (President and CEO)

Thank you, operator, and thank you all for taking the time to join us here on our first quarter earnings call. We are optimistic, as you've heard, about our growth opportunities and our future regulated energy delivery projects, and encouraged by the strong demand along with performance of our construction services business. As we look forward to with you again as we progress through 2023, thank you again. We appreciate your continued interest and support of MDU Resources. With that, I'll turn it back to the operator.

Operator (participant)

Thank you. Ladies and gentlemen, that does conclude today's conference. We appreciate your participation, and have a wonderful day.