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MDU Resources' Construction Materials Group Up 20%

MDU Resources Group Inc. reported second quarter earnings of $61.8 million, or 31 cents per share, compared to second quarter 2018 earnings of $43.8 million, or 22 cents per share. For the six months ended June 30, MDU Resources earned $102.7 million, or 52 cents per share, compared to $86.2 million, or 44 cents per share, in 2018.

"With a 41% increase in year-over-year second quarter earnings driven by our strong operational performance and the positive impact of organic and acquisition growth, we are increasing our 2019 earnings guidance range by 5 cents per share and our combined construction revenue guidance by over $200 million for the year," said David L. Goodin, president and CEO of MDU Resources. "Our construction services business continues to have exceptional results, with year-to-date earnings 47% higher through June compared to last year, and our construction materials business increased second quarter earnings by approximately 20% over last year. We also had an all-time record backlog of nearly $2.2 billion at our combined construction businesses at the end of the quarter.

"Our pipeline business continues to successfully execute on several growth opportunities, including two significant pipeline expansion projects under construction this year that are progressing on schedule and on budget. For the 10th consecutive quarter, this business transported record volumes of natural gas, and with Bakken production at record levels, demand remains high for additional transportation capacity in the region. During the quarter our utility business received approval on an electric rate settlement in Montana and continues to pursue regulatory relief while updating and expanding its electric and natural gas systems to ensure safe and reliable service to customers."

The construction services business reported record earnings for the second quarter of $22.8 million, compared to $14.1 million for the same period in 2018. This business continues to execute well on the numerous inside and outside projects in its backlog, particularly for data center and utility customers, while also adding significant projects to its workload, including the recently announced hospitality industry contracts for electrical and mechanical work on Resorts World Las Vegas. The construction services business had record second quarter backlog of $1.15 billion, a 30% increase from $888 million in 2018.

Earnings at the construction materials business were $29.2 million in the second quarter, compared to $24.3 million in the second quarter of 2018. The increase reflects contributions from acquisitions made in 2018 and early 2019, as well as additional project opportunities from the strong economic environments in many of the states where the company operates. The construction materials business had an all-time record backlog of work at June 30 of $1.04 billion, a 42% increase from $731 million in 2018.