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MGE ENERGY INC (MGEE)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 EPS of $1.22 beat S&P Global consensus by $0.03 (vs $1.19*), on higher rate base investment and ~$2.2M non-utility investment gains; revenue was $175.7M (no S&P revenue consensus available*) .
  • Year-over-year, net income rose to $44.5M from $40.9M on stronger Electric segment earnings (+$1.3M YoY) as Darien Solar (25 MW) and Paris BESS (11 MW) entered service in 2025 .
  • Sequentially, margins expanded materially vs Q2 on operating leverage; EBIT margin rose to 30.8%* (Q2: 23.3%) and net income margin to 25.3% (Q2: 16.6%*) .
  • Strategic update: MGE filed to add >85 MW of solar and 18 MW of storage (10% stakes across five WEC-partnered projects), supporting net-zero 2050 roadmap and capex visibility; management highlighted >40 renewable and storage projects planned by 2030 .

What Went Well and What Went Wrong

  • What Went Well

    • Electric segment earnings increased by $1.3M YoY on rate base growth from renewables (Darien Solar in March; Paris BESS in June) .
    • Non-utility investment gains (~$2.2M) lifted results, with VC funds aligned to smart tech, DERs, electrification, and cybersecurity .
    • Management reiterated long-term decarbonization strategy and filed to add >85 MW solar and 18 MW storage; “by 2030, we will have added more than 40 renewable generation and battery storage projects … totaling more than 750 MW,” per CEO Jeff Keebler .

  • What Went Wrong

    • Gas net income was “steady” with minimal change vs prior year, implying limited contribution to upside in the quarter .
    • Estimate coverage remains thin (EPS consensus based on 1 estimate*), limiting the signaling value of the beat and increasing quarter-to-quarter noise* [GetEstimates].
    • No explicit quantitative guidance provided; investors must infer trajectory from rate base additions, filings, and press disclosures .

Financial Results

MetricQ1 2025Q2 2025Q3 2025
Operating Revenues ($M)$218.97 $159.45 $175.68
Operating Income ($M)$52.87 $34.22 $51.08
Net Income ($M)$41.59 $26.50 $44.50
Diluted EPS ($)$1.14 $0.72 $1.22
EBIT Margin %*25.54%*23.27%*30.77%*
Net Income Margin %*18.99%*16.62%*25.33%*

Note: * Values retrieved from S&P Global.

Q3 2025 vs Prior Year and vs Estimates

MetricQ3 2024Q3 2025Wall St. Consensus (S&P Global)Beat/Miss
Revenue ($M)$168.48 $175.68 N/A*N/A
Diluted EPS ($)$1.13 $1.22 $1.19*+$0.03 (Beat)

Consensus Detail (Q3 2025)

MetricEstimate# of Estimates
Primary EPS Consensus Mean*$1.19*1*

Note: * Values retrieved from S&P Global.

KPIs and Operating Drivers

KPI / DriverDetail
Electric segment earnings+$1.3M YoY, driven by rate base growth
Non-utility investment gains~+$2.2M from venture capital funds
New assets in service (2025)Darien Solar 25 MW (Mar 2025); Paris BESS 11 MW (Jun 2025)
Weather impact (context)Q2 electric residential sales +~5% on warmer-than-normal weather (helped prior quarter)
Q1 volume contextGas retail sales +19% and electric +3% YoY on relatively normal weather (vs milder prior year)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Company guidance2025/Q4–FYNone disclosedNone disclosedMaintained (no formal guidance)
Dividend policyOngoing50 consecutive years of dividend increases (as of Sep 2025)Unchanged statementMaintained

Earnings Call Themes & Trends

Note: An earnings call transcript was not available in our document set. Themes below reflect company press releases.

TopicQ1 2025 (May)Q2 2025 (Aug)Q3 2025 (Nov)Trend
Rate base growth/renewablesDarien Solar (25 MW) in service; rate base growth supporting EPS Darien Solar + Paris BESS entered service; rate base supporting higher Electric earnings Renewables in service underpin YoY Electric earnings +$1.3M Positive, compounding
Weather/macro“Relatively normal” weather; YoY gas +19%, electric +3% Warmer-than-normal weather lifted residential electric sales ~5% Not cited as driver (mix shifted to investments/VC gains) Normalizing
Non-utility earningsNot highlightedNot highlighted~$2.2M VC gains boosted non-utility earnings New tailwind
Regulatory/capexOngoing investment in renewables Ongoing renewables investment Filing to add >85 MW solar + 18 MW storage; 10% stakes across five projects Accelerating pipeline
Customer/segmentsGas +19% YoY; electric +3% YoY Residential electric +~5% YoY Gas net income “steady”; Electric segment up Stable demand; electric-led growth

Management Commentary

  • “Rate base investment growth and non-utility investment gains drove our third-quarter results.” — MGE Energy press release, Nov 5, 2025 .
  • “The Darien Solar Project … became operational in March 2025, followed by the Paris Battery Energy Storage System (BESS) in June 2025. MGE owns 25 MW of solar capacity … and 11 MW of battery capacity …” .
  • “With our current plans, by 2030, we will have added more than 40 renewable generation and battery storage projects since 2015, totaling more than 750 MW, propelling us toward our goal of net-zero carbon electricity by 2050.” — Jeff Keebler, Chairman, President and CEO .

Q&A Highlights

  • No earnings call transcript was available in our sources; no Q&A details to report this quarter.

Estimates Context

  • EPS beat: $1.22 actual vs $1.19 S&P Global consensus mean, +$0.03; coverage limited (1 estimate)*. This modest beat was driven by higher Electric segment earnings from rate base growth and ~$2.2M non-utility gains .
  • Revenue: No S&P Global revenue consensus available*; reported $175.68M .
    Note: * Values retrieved from S&P Global.

Key Takeaways for Investors

  • Rate base growth from renewables in service (Darien Solar, Paris BESS) is translating into earnings, with Electric segment up $1.3M YoY and sequential margin expansion .
  • Non-utility VC gains (~$2.2M) provided incremental upside; investors should treat this as potentially volatile, non-core earnings .
  • Pipeline building: Filing to add >85 MW solar and 18 MW storage (10% stakes, with WEC) expands capex visibility and supports long-term decarbonization targets .
  • Gas remained steady; near-term growth is likely to be electric-led as renewables and storage are placed into service .
  • Estimate coverage is thin (1 EPS estimate*), so quarterly “beats” may have limited signaling power; focus on multi-quarter margin and rate base trajectories*.
  • With no formal guidance, track PSC approvals, project in-service dates, and margin cadence as primary catalysts .
    Note: * Values retrieved from S&P Global.