Black Hills 2025 Q2 Earnings Strong Performance as Net Income Rises 16.6%

Black Hills (BKH) reported its fiscal 2025 Q2 earnings on Jul 31st, 2025. The results reflected a robust performance, with EPS rising by 15.2% to $0.38, above market expectations. The company reaffirmed its 2025 earnings guidance, projecting EPS between $4.00 and $4.20, which aligns with previous forecasts. Black Hills' commitment to its $1 billion capital plan, including significant infrastructure projects, underscores its growth strategy, with an anticipated long-term annual growth rate of 4% to 6%.

Revenue
In the second quarter of 2025, Black Hills saw a 9.0% increase in total revenue, reaching $439 million, up from $402.60 million in the same period the previous year. The Electric Utilities segment contributed $219.90 million, while the Gas Utilities segment generated $223 million. The Corporate and Other segment recorded a negative revenue of $3.90 million, leading to a consolidated total of $439 million.

Earnings/Net Income
Black Hills reported a 15.2% rise in EPS to $0.38 in Q2 2025, up from $0.33 in Q2 2024. Net income increased by 16.6% to $28.80 million from $24.70 million in the same period the previous year. This performance reflects strong operational resilience, with EPS growth indicating a positive financial outlook.

Post-Earnings Price Action Review
Following the earnings release, the strategy of buying BKH stock when earnings surpass expectations and selling after 30 days yielded a return of 6.29%. However, this return was considerably lower than the benchmark return of 85.57%, resulting in an excess return of -79.28% and a compound annual growth rate (CAGR) of only 1.24%. Despite the low-risk nature of this strategy, indicated by a maximum drawdown of 0.00%, its Sharpe ratio of 0.10 reflects a low-reward approach. This suggests that while the strategy is stable, it may not maximize potential gains in comparison to broader market opportunities.

CEO Commentary
Black Hills Corp. CEO highlighted the company's solid Q2 2025 performance, emphasizing a 15.2% increase in earnings per share to $0.38. This growth was attributed to improved weather conditions and new rates. The CEO noted the significance of Kansas Gas's regulatory approval for a $10.8 million annual revenue increase, reflecting the company's dedication to operational cost recovery and long-term financial stability. Additionally, the progress of the $350 million Ready Wyoming transmission project was underlined as a strategic investment aimed at enhancing system reliability and supporting renewable energy development.

Guidance
Black Hills Corp. reaffirmed its 2025 earnings guidance, projecting earnings per share between $4.00 and $4.20. The company remains dedicated to its $1 billion capital plan, which includes significant infrastructure projects, and anticipates continued growth aligning with its long-term target of 4% to 6%. The CEO expressed confidence in maintaining strong financial metrics and executing strategic initiatives to position Black Hills favorably in the market.

Additional News
In recent news, Black Hills Corp. declared a quarterly dividend of $0.676 per share for common shareholders, payable on September 2, 2025, to those of record as of August 18, 2025. Additionally, the company announced regulatory approval for new rates at its Kansas Gas utility, promising an additional $10.8 million in annual revenues. Lastly, Black Hills communicated the progress of its $350 million Ready Wyoming transmission project, aimed at enhancing system reliability and supporting renewable energy development. These developments highlight the company’s proactive approach to financial management and infrastructure investment.