MDU Resources Group, Inc. (NYSE:MDU) today reported second quarter consolidated adjusted earnings of $47.2 million, or 25 cents per share, compared to $32.5 million, or 17 cents per share in the second quarter of 2012. Consolidated GAAP earnings were $46.3 million, or 24 cents per common share, compared to $53.9 million, or 29 cents per common share for the second quarter of 2012. For an explanation of non-GAAP earnings adjustments, see the Reconciliation of GAAP to Adjusted Earnings and the Use of Non-GAAP Financial Measures sections later in this press release.
"We had a strong quarter, led by another impressive increase in oil production and strong earnings growth from our construction business," said David L. Goodin, president and CEO of MDU Resources. "Our construction business had their most profitable second quarter since 2008. That and their growing backlog are encouraging signs that a sustained recovery is taking hold in the industry.
"Our exploration and production business has increased its 2013 target to 25 to 35 percent year-over-year growth in oil production," Goodin said. "At midyear, Fidelity has increased oil production 41 percent over the first six months of 2012."
Fidelity's oil production in the Bakken increased by 42 percent in the second quarter, compared to the same period a year ago. Oil production in the increasingly prolific Paradox Basin nearly quadrupled over the same time period.
Earnings at the company's construction business increased 39 percent despite a slow start to the construction season caused by record wet weather in parts of the Midwest. The construction materials and contracting business had improved earnings on lower revenues as a result of margin expansion driven in part by a lower cost structure. Earnings increased in all regions of the construction services business. The combined construction backlog has grown to $1.2 billion, compared to $980 million at the same time in 2012.
The utility business experienced a lower seasonal loss for the quarter compared to last year. Natural gas sales grew 14 percent primarily the result of colder weather along with 4 percent growth in electric retail sales. Customer growth continues strong particularly in the Bakken area with a 7 percent increase in electric customers and 6 percent increase in natural gas customers compared to last year. Earnings on a year-to-date basis are at a record pace totaling $40.8 million.