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MGE ENERGY INC (MGEE)·Q1 2025 Earnings Summary

Executive Summary

  • Strong quarter: Q1 2025 GAAP EPS was $1.14, up 22.6% year over year (vs $0.93 in Q1 2024) on operating revenues of $218.97M (+14.4% YoY); operating income rose 29.8% YoY, driven by rate base investment growth and weather normalization .
  • EPS beat: EPS of $1.14 vs S&P Global consensus $0.98, a beat of $0.16 (+16.3%) as weather and higher electric rate base supported performance *.
  • Sequential step-up: Versus Q4 2024, revenue +27.8%, operating income +91.2%, EPS +86.9%, reflecting seasonality and colder, more normal weather versus milder prior-year conditions .
  • Strategic catalyst: Darien Solar became operational in March (MGE owns 25 MW); PSCW approved additional local solar and battery projects (Sunnyside) and purchase of High Noon capacity, reinforcing asset growth and decarbonization trajectory .

What Went Well and What Went Wrong

What Went Well

  • Rate base-driven earnings growth: “An increase in electric investments included in rate base contributed to increased electric earnings for 2025,” underpinning Q1 performance .
  • Demand tailwinds: Gas retail sales +19% YoY and electric retail sales +3% YoY on more normal winter weather versus unusually mild Q1 2024 .
  • Renewable execution: Darien Solar online (25 MW share), advancing cost-effective, carbon-free energy to customers; management emphasizes projects “helping to fuel the company's asset growth” .

What Went Wrong

  • Limited disclosure/guidance: No formal revenue/EPS guidance ranges provided in Q1 materials, constraining near-term estimate precision .
  • Call accessibility: No Q1 2025 earnings call transcript found, reducing transparency into drivers and outlook nuances beyond the press release [List: earnings-call-transcript search returned none for 2025].
  • Gas volume volatility context: Company highlighted 2024 gas retail therm deliveries were ~4% lower due to warm weather; underscores weather sensitivity into future periods .

Financial Results

Quarterly comparison (oldest → newest)

MetricQ3 2024Q4 2024Q1 2025
Operating Revenues ($USD Millions)$168.48 $171.42 $218.97
Operating Income ($USD Millions)$48.14 $27.64 $52.87
Net Income ($USD Millions)$40.94 $22.02 $41.59
Diluted EPS ($USD)$1.13 $0.61 $1.14
EBIT Margin % (Operating Income / Revenues)28.6% 16.1% 24.2%
Net Income Margin % (Net Income / Revenues)24.3% 12.9% 19.0%

Year-over-year Q1 comparison (oldest → newest)

MetricQ1 2024Q1 2025
Operating Revenues ($USD Millions)$191.34 $218.97
Operating Income ($USD Millions)$40.75 $52.87
Net Income ($USD Millions)$33.81 $41.59
Diluted EPS ($USD)$0.93 $1.14

KPIs (Q1 2025)

KPIValue
Gas retail sales YoY+19%
Electric retail sales YoY+3%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Regular Dividend per ShareQ1 2025 (Declared Jan)$0.45 $0.45 (Declared May) Maintained

Note: No formal guidance ranges (revenue, margins, OpEx, OI&E, tax rate) were provided in Q1 materials .

Earnings Call Themes & Trends

Note: No Q1 2025 earnings call transcript available in our document set.

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Fuel costsLower than PSCW plan aided electric earnings ——Neutral→N/A
Weather/macro—2024 gas therms ~4% lower on warm weather More normal vs milder Q1 2024; gas +19%, electric +3% Improving (weather normalization)
Renewable buildout—Paris solar completed Dec 2024 Darien online; Sunnyside approved; High Noon purchase approved Strengthening
Regulatory approvals——PSCW approvals for Sunnyside, High Noon Positive
Rate base growth——Increased electric investments in rate base drove earnings Positive

Management Commentary

  • “An increase in electric investments included in rate base contributed to increased electric earnings for 2025.” (Q1 press release) .
  • “MGE shares with our customers the goal of a more sustainable energy future… The Sunnyside Solar Energy Center builds on the progress we've already made reducing carbon emissions, increasing our use of cost-effective, locally generated renewable energy and advancing new technologies to benefit all our customers.” — Jeff Keebler, Chairman, President and CEO .
  • “The High Noon Solar Energy Center builds on the progress we've already made reducing carbon emissions, increasing our use of cost-effective renewable energy and advancing new technologies to benefit all our customers.” — Jeff Keebler .
  • “Carbon is our target, and the Darien Solar Energy Center is another important step as we continue our progress toward achieving our science-based carbon reduction goals…” — Jeff Keebler .

Q&A Highlights

No Q1 2025 earnings call transcript was found in the document catalog, so no Q&A details are available from primary sources [List: earnings-call-transcript search returned none for 2025].

Estimates Context

  • EPS vs consensus: Q1 2025 EPS $1.14 vs S&P Global consensus $0.98; beat by $0.16 (+16.3%) on more normal weather and rate base growth *.
  • Revenue consensus: No published S&P Global revenue estimate available in our dataset for Q1 2025; actual operating revenues were $218.97M *.
MetricQ1 2025
EPS Consensus Mean ($)0.98*
EPS Actual ($)1.14
EPS – # of Estimates1*
Revenue Actual ($USD Millions)$218.97

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Weather normalization and increased electric rate base drove a clear EPS beat; utilities seasonality plus investment cadence matter near term *.
  • Asset growth is accelerating: Darien online with multiple PSCW-approved solar and storage projects (Sunnyside, High Noon) in the pipeline, supporting long-term rate base and earnings visibility .
  • Margins improved sequentially: EBIT margin rose from 16.1% in Q4 2024 to 24.2% in Q1 2025; net income margin from 12.9% to 19.0%, reflecting stronger seasonal demand and cost/asset mix .
  • Dividend stability continues ($0.45/qtr declared Jan and May), reinforcing income profile and capital discipline .
  • Limited formal guidance and lack of call transcript reduce visibility; watch for regulatory filings, PSCW dockets, and subsequent quarters’ releases for updated outlook signals .
  • Near-term trading: Positive surprise on EPS with supportive regulatory news flow; defensiveness plus growth via renewables may attract yield-and-growth investors post-print *.
  • Medium-term thesis: Decarbonization-driven capex into solar/storage and resulting rate base expansion underpin earnings trajectory; weather variability remains a core risk factor to volumes .