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Otter Tail Corporation Announces Annual Earnings and Initiates 2026 Earnings Guidance

OTTR
  • Otter Tail Corporation reported 2025 diluted earnings per share of $6.55 & a consolidated return on equity of 16%.
  • The company initiated 2026 diluted earnings per share guidance ranging from $5.22 to $5.62, with a projected return on equity of 12% at the midpoint.
  • Electric segment operating revenues increased 8.1% to $566.8 million, driven by fuel recovery revenues, rate base investment recoveries, & favorable weather.
  • Manufacturing segment operating revenues decreased 8.2% to $314.5 million due to a 6% decline in sales volumes across agriculture & recreational vehicle markets.
  • Plastics segment operating revenues fell 8.8% to $422.8 million, primarily caused by a 15% decline in average sales prices despite an 8% increase in sales volumes.
  • Consolidated operating cash flow for 2025 was $386.0 million, down from $452.7 million in 2024 due to higher working capital requirements & lower earnings.
  • Total capital expenditures for 2025 were $288.1 million, with the majority allocated to the Electric segment for wind repowering, solar facilities, & transmission projects.
  • Financing activities in 2025 included the issuance of $100.0 million in long-term debt & dividend payments totaling $88.1 million.
  • As of December 31, 2025, Otter Tail held total available liquidity of $705.5 million, comprising $319.3 million under credit facilities & $386.2 million in cash.
  • The 2026 capital expenditure plan projects $2.05 billion in total spending over five years, targeting a 10% compounded annual growth rate in the Electric segment's rate base.
  • Electric segment earnings are expected to rise 14% in 2026 driven by a 14% increase in average rate base & interim revenues from Minnesota & South Dakota rate cases.
  • Plastics segment earnings are forecast to decline 36% in 2026 due to continued reductions in average product sales prices, partially offset by increased sales volumes.
  • Manufacturing segment earnings are anticipated to increase 7% in 2026 based on modest volume growth in horticulture products & improved productivity.
  • The company reaffirmed a long-term earnings per share growth target of 7% to 9% & a total shareholder return target of 10% to 12%.