Otter Tail Corporation Reports Record 2024 Earnings, Updates Growth Outlook

February 17, 2025 10:31 PM PST | By Team Kalkine Media

Otter Tail Corporation Reports Record 2024 Earnings, Updates Growth Outlook — Image source: Shutterstock

Financial Performance & Earnings Growth

Otter Tail delivered a strong financial performance in 2024, achieving annual diluted earnings per share (EPS) of $7.17 and a return on equity of 19.3% on an equity ratio of 62.2%. Despite a $3.8 million decrease in operating revenues, primarily driven by lower retail and wholesale energy sales, net income increased by $6.5 million. This was largely due to an interim rate increase in North Dakota and higher rider revenue, which helped offset the impact of unfavorable weather conditions.

The company also faced higher depreciation and interest expenses related to capital investments, but continued investment in its rate base drove growth in earnings and long-term returns.

Strategic Growth & 2025 Outlook

Otter Tail updated its five-year electric utility rate base compounded annual growth rate (CAGR) to 9.0%, up from the previous projection of 7.7%. Additionally, the company raised its long-term EPS growth target to 6-8%, reflecting its confidence in sustained profitability and expansion.

Looking ahead, Otter Tail projects 2025 diluted EPS to be between $5.68 and $6.08. The earnings mix is expected to be 39% from the Electric segment and 61% from the Manufacturing and Plastics segments. This is a temporary shift from the company’s long-term target of 65% Electric / 35% Non-Electric, as earnings from the Plastics segment are anticipated to remain elevated in 2025 before normalizing in the future.

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