[8-K] MGE Energy Inc Reports Material Event

Rhea-AI Filing Summary

Matthews International (MATW) Q3-FY25 10-Q highlights:

• Top-line pressure: Sales fell 18% YoY to $349.4 million and are down 13% YTD to $1.18 billion, hurt by the May 1 divestiture of the SGK Brand Solutions business and softer demand in Industrial Technologies.
• SGK divestiture: Company contributed the majority of its Brand Solutions unit to Propelis Group, recognizing a $57.1 million pre-tax gain this quarter. Consideration received: 40% equity stake in Propelis (recorded at $213 million) and $50 million preferred equity.
• Earnings swing: Operating profit jumped to $75.2 million from $6.7 million last year, but excluding the SGK gain management’s operating profit was roughly $18 million. Net income rose to $15.4 million ($0.49 diluted EPS) versus $1.8 million; YTD EPS is $0.10.
• Margins: Q3 gross margin expanded 380 bps to 34.9% on improved Memorialization mix and lower SGK contribution.
• Balance sheet moves: Debt cut 9.5% YTD to $702.5 million; cash fell to $20.4 million after $12.1 million share repurchases and $24.7 million dividends. Equity climbed 17% to $513.8 million due mainly to FX translation gains (+$98.8 million) and the SGK transaction.
• Cash flow weak: YTD operating cash outflow of $33.9 million vs. +$43.3 million prior year, driven by working-capital build and tax on SGK gain; partly offset by $228 million SGK proceeds.
• Guidance: No forward guidance provided.

Key risks: revenue concentration in Memorialization, integration of Propelis stake, high leverage (Net debt ≈ $682 million, 4.16% avg. cost).

Positive

• $57.1 million gain from SGK sale lifted quarterly operating profit and strengthened equity.
• Debt reduced by $73.9 million YTD, lowering leverage and interest burden.
• Gross margin +380 bps YoY to 34.9%, reflecting favorable mix and divestiture impact.

Negative

• Revenue down 18% YoY and 13% YTD, indicating core demand weakness post-divestiture.
• Operating cash flow –$33.9 million YTD, reversing prior-year inflow.
• Net income only $3 million YTD; without SGK gain, profitability remains low.
• Goodwill impairment risk after $181 million decrease from divestiture could spotlight remaining units.

Insights

Equity Research Analyst

TL;DR: Sale of SGK boosts optics, but core revenue softness and negative cash flow temper enthusiasm.

The $57 million gain masks an 18% revenue decline and weak underlying earnings. Ex-gain EPS would be near breakeven. Memorialization remains stable, yet Industrial Technologies slipped 4% and Brand Solutions is now minority-owned, removing a growth lever. Net debt/EBITDA likely stays >3× despite 9% debt cut. Equity stake in Propelis offers upside, but it is illiquid and carries execution risk. Overall impact: neutral.

Credit Analyst

TL;DR: Leverage trending lower, liquidity adequate, but cash burn raises caution.

Debt reduced to $702 million and swaps limit rate risk; revolver covenant headroom intact. However, negative $34 million operating cash and $12 million buybacks signal ongoing free-cash challenges. SGK proceeds largely redeployed to investments, not deleveraging. Interest coverage (~3.0×) acceptable but sensitive to EBITDA normalization. Outlook: slightly credit-positive yet watch working capital.

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		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
	FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
		August 6, 2025 Date of report (date of earliest event reported)
Commission File No.		Name of Registrant, State of Incorporation, Address of Principal Executive Offices, and Telephone No.		IRS Employer Identification No.
000-49965		MGE Energy, Inc. (a Wisconsin Corporation) 133 South Blair Street Madison, Wisconsin 53788 (608) 252-7000 | mgeenergy.com		39-2040501
000-1125		Madison Gas and Electric Company (a Wisconsin Corporation) 133 South Blair Street Madison, Wisconsin 53788 (608) 252-7000 | mge.com		39-0444025

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Common Stock, $1 Par Value Per Share		MGEE		The NASDAQ Stock Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

MGE Energy, Inc. ☐ Madison Gas and Electric Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

MGE Energy, Inc. ☐ Madison Gas and Electric Company ☐

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Item 2.02. Results of Operations and Financial Condition.

On August 6, 2025, MGE Energy, Inc. (the Company) issued a press release announcing its second quarter 2025 earnings. The Company is furnishing a copy of that press release as Exhibit 99.1 to this report.

This combined Form 8-K is being furnished separately by the Company and Madison Gas and Electric Company. Information contained herein relating to any individual registrant has been furnished by such registrant on its own behalf. Neither registrant makes any representation as to information relating to the other registrant.

Item 7.01. Regulation FD Disclosure.

On August 6, 2025, MGE Energy, Inc. posted a financial presentation on its Investor Relations website. A copy of the presentation is attached as Exhibit 99.2. This Form 8-K and the attached exhibits are furnished to, but not filed with, the Securities and Exchange Commission.

Item 9.01. Financial Statements and Exhibits.

(a) Financial statements of businesses acquired: None

(b) Pro forma financial information: None

(c) Shell company transactions: None

(d) Exhibits.

Exhibit No.		Description
99.1		Press release of MGE Energy, Inc., issued on August 6, 2025.
99.2		Presentation Slides.
104		Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned hereunto duly authorized.

	MGE Energy, Inc. Madison Gas and Electric Company
	(Registrants)
Date: August 6, 2025	/s/ Jenny L. Lagerwall
	Jenny L. Lagerwall Assistant Vice President - Accounting and Controller (Chief Accounting Officer)

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FAQ

Why did MATW's revenue decline in Q3 FY25?

Sales fell 18% mainly due to the divestiture of the SGK Brand Solutions business and softer Industrial Technologies demand.

What consideration did MATW receive for the SGK Brand Solutions sale?

MATW received a 40% equity interest in Propelis valued at $213 million and $50 million in preferred equity, plus cash proceeds of $228 million.

How much debt does Matthews International carry after the quarter?

Total debt is $702.5 million, down from $776.5 million at FY24 year-end; weighted average cost is about 4.16%.

What were MATW's earnings per share for Q3 FY25?

Diluted EPS was $0.49 compared with $0.06 in the prior-year quarter.

Did the company provide guidance for FY25?

No forward financial guidance was disclosed in the 10-Q filing.