MDU Resources Group (NYSE:MDU) used its year-end 2025 earnings call to highlight results from its first full year as a pure-play regulated energy delivery company, emphasizing continued capital deployment, regulatory activity, and record earnings in its pipeline business. President and CEO Nicole Kivisto and CFO Jason Vollmer also provided 2026 earnings guidance and discussed the company’s approach to large-load data center opportunities and several longer-dated pipeline growth projects.
2025 earnings and capital deployment
MDU reported 2025 earnings of $190.4 million, or $0.93 per share, which Kivisto said landed in the middle of the company’s earnings-per-share guidance range. During 2025, the company deployed $792 million of capital across the business, advancing projects and contributing to utility rate base growth.
MDU also reported combined retail customer growth of 1.5% versus 2024, which management said was within its targeted annual growth rate of 1% to 2%.
Regulatory updates across electric and gas utilities
Management described 2025 as an active year on the regulatory front and said that progress not only benefited 2025 results but also supports future growth plans.
- North Dakota: MDU filed for recovery of the Badger Wind investment through an updated renewable resource cost adjustment on October 31, 2025. The North Dakota Public Service Commission approved the cost adjustment on January 26, 2026.
- South Dakota: The company filed an audit period update to its infrastructure rider on October 31, 2025, reflecting recovery of Badger Wind.
- Montana (electric): MDU filed an electric general rate case on September 30, 2025, including recovery of Badger Wind and other investments since its last proceeding in 2023, along with increased operating costs. The Montana Public Service Commission has nine months to rule. The company requested interim rates effective January 1, 2026, but the request was denied. MDU sought reconsideration on December 26, 2025; the request was before the commission on February 3, 2026, with no action taken, management said.
- Wyoming (electric): A settlement agreement was filed reflecting an annual increase of $5.8 million and a stipulation to withdraw a requested reliability and safety rider. Rates are anticipated to be effective April 1, 2026.
- Wildfire mitigation: Kivisto said MDU filed wildfire mitigation plans in North Dakota, Montana, and Wyoming in late December.
On the natural gas side, Kivisto noted several additional regulatory items:
- Idaho: A natural gas general rate case settlement was approved December 30, 2025, for an annual increase of $13 million, with rates effective January 1, 2026.
- Washington: The second-year increase under the company’s multi-year rate plan is expected to take effect March 1, 2026, reflecting an increase of $10.8 million annually from current rates, subject to completion of a provisional plant review.
- Oregon: MDU filed a general rate case on November 25, 2025, with rates anticipated to be effective October 31, 2026.
Data center load and “capital-light” approach
MDU said it has 580 megawatts of data center load under signed electric service agreements. Of that total, the company said 180 MW has been online since May 2023, with an additional 100 MW ramping online currently. Management expects another 150 MW to come online later in 2026, and the remaining 150 MW is expected online in 2027.
Kivisto said MDU’s current approach to serving large customer opportunities is a capital-light business model, which management said benefits earnings and returns while also providing cost savings to other retail customers through lower transmission allocation and margin sharing. She added that the company continues discussions with potential additional data center customers, and if those discussions lead to signed agreements, MDU would consider investing capital into new generation, transmission, and related assets to serve the load.
Pipeline segment results and growth projects
MDU’s pipeline segment delivered record earnings of $68.2 million in 2025, compared with $68.0 million in 2024. Vollmer attributed the increase primarily to expansion projects placed in service throughout 2024 and late in 2025, along with customer demand for short-term firm transportation contracts. He said higher operating and maintenance expense—primarily payroll-related costs—partially offset those benefits.
Vollmer also noted that 2024 results benefited from items that did not recur in 2025, including proceeds from a customer settlement and a benefit tied to a change in the company’s effective state income tax rate, together totaling about $2.7 million in 2024. Higher depreciation expense due to capital investments and higher property taxes, primarily in Montana, were additional offsets in 2025.
Looking ahead, Kivisto outlined several pipeline initiatives:
- Line Section 32 expansion: The company is completing required surveys for the project, which will provide natural gas transportation service to an electric generation facility under construction in northwest North Dakota. MDU expects to file its FERC application in March 2026 and is targeting construction completion in late 2028.
- Minot Industrial Pipeline (early-stage): MDU signed an agreement to support early-stage development through the second quarter of 2026. The potential project could include an approximately 90-mile pipeline from Tioga to Minot, North Dakota, to provide incremental transportation capacity for anticipated industrial demand.
- Bakken East Pipeline (proposed): MDU submitted a FERC pre-filing request on December 23, 2025, and launched a binding open season on February 2, 2026, which will close March 13. Management said it continues contract negotiations with interested parties and will use open season results and negotiations to finalize design and determine whether to make a final investment decision. Kivisto reiterated projected in-service timing of late 2029 for the western portion and late 2030 for the eastern portion. The project is not currently included in the company’s five-year capital forecast and would be incremental if pursued. Management said it would evaluate financing options including balance sheet funding and potential partnerships.
Segment performance details and financing actions
Vollmer said 2025 results reflected the company’s streamlined structure following the October 2024 spinoff of Everus, noting that certain spinoff-related costs and Everus’ historical results are reported in discontinued operations. MDU reported income from continuing operations of $191.4 million, or $0.93 per diluted share, compared with $181.1 million, or $0.88 per diluted share in 2024.
By segment:
- Electric utility: Earnings were $64.9 million versus $74.8 million in 2024. Higher retail sales revenue and volumes were more than offset by higher operating and maintenance expense, including higher payroll-related costs, contract services tied to generation station outages, software expense, and insurance expense.
- Natural gas utility: Earnings were $56.1 million versus $46.9 million in 2024, a 19.6% increase, driven primarily by higher retail sales revenue due largely to rate relief in multiple jurisdictions. Higher operating and maintenance expense (including insurance, payroll-related costs, and software) partially offset the increase.
On financing, Vollmer said the company maintains a strong balance sheet and access to working capital. In December, MDU completed a follow-on public offering of just over 10.15 million shares at $19.70 per share, and underwriters exercised an option to purchase approximately 1.5 million additional shares. Through forward sale agreements tied to the offering, MDU has discretion to settle before December 6, 2027, subject to adjustments and fees. Vollmer said roughly 11.7 million shares are expected to meet all 2026 equity issuance needs and a significant portion of 2027 equity needs.
He added that due to the Badger Wind acquisition at year-end, consolidated debt-to-capitalization increased slightly to 49.1% and is expected to decline as the company settles the forward sale agreements.
For 2026, management initiated earnings guidance of $0.93 to $1.00 per share. In response to a question on year-over-year headwinds, management pointed to the impact of equity issuance used to support growth projects, while noting expected benefits from rate case activity and the addition of Badger Wind. MDU reiterated its long-term target of 6% to 8% EPS growth and a targeted annual dividend payout ratio of 60% to 70%.
About MDU Resources Group (NYSE:MDU)
MDU Resources Group, Inc is a diversified energy and services holding company headquartered in Bismarck, North Dakota. The company operates through two primary segments: Utilities and Construction Services and Pipelines & Midstream. Serving a broad geographic footprint across the upper Midwest and Pacific Northwest, MDU provides essential energy distribution and infrastructure services to residential, commercial and industrial customers.
The Utilities segment delivers electric and natural gas distribution services in Montana, North Dakota, South Dakota, Minnesota, Kansas, Wisconsin, Michigan and Washington.
