Otter Tail reports increased annual earnings

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Otter Tail reports increased annual earnings
Credit: © Reuters.

FERGUS FALLS, Minn. - Otter Tail (NASDAQ: OTTR ) Corporation (NASDAQ:OTTR) disclosed its financial results for the quarter and year ending December 31, 2023. The company saw a 4% rise in consolidated net income to $294.2 million and a 3% increase in diluted earnings per share to $7.00 for the year. However, operating revenues declined by 8% to $1.3 billion compared to 2022.

The Electric segment's earnings grew by 6%, driven by rate base investments recovery and higher commercial and industrial sales. The Manufacturing segment experienced a modest increase, while the Plastics segment's earnings dropped by 4% due to reduced sales volumes, although it continued to perform strongly relative to pre-2021 levels.

Otter Tail Power completed the acquisition of Ashtabula III, a 62 MW wind facility, and launched Hoot Lake Solar, a 49 MW solar project, in 2023. The Electric segment's updated 5-year capital expenditure plan totals $1.3 billion, aiming for a 7.7% compounded annual rate base growth.

The board of directors increased the quarterly common stock dividend by 7% to $0.4675 per share for 2024, up from $1.75 per share in 2023. The company ended the year in a strong financial position, with $479.8 million in total available liquidity.

The corporation anticipates a diluted earnings per share guidance range of $5.13 to $5.43 for 2024, reflecting expected growth in the Electric segment and a decline in Plastics segment earnings due to a downward trend in sales prices and resin spreads.

Otter Tail Corporation's cash provided by operating activities reached a record $404.5 million in 2023, primarily due to increased net income and decreased pension plan contributions. The company's capital expenditures were $287.1 million, mainly for investments within the Electric segment.

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