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FERGUS FALLS, Minn., Nov. 1 /PRNewswire-FirstCall/ -- Otter Tail Corporation (Nasdaq: OTTR) announced financial results for the quarter ended September 30, 2007 with the following highlights:

-- Record third quarter revenues of $302.2 million. -- Consolidated net income of $13.3 million for the third quarter of 2007 compared with $13.5 million for the third quarter of 2006. -- Diluted earnings per share of $0.44 for the third quarter of 2007 compared with $0.45 for the third quarter of 2006. Announcements: -- On November 1, 2007 the Board of Directors declared a quarterly common stock dividend of 29.25 cents per share, payable December 10. The Board also declared quarterly dividends on the corporation's four series of preferred stock, payable December 1. Dividends are payable to shareholders of record as of November 15. -- The corporation reaffirms its 2007 diluted earnings per share guidance from continuing operations to be in the range of $1.60 to $1.80.

"Our third quarter financial results were in line with our expectations," said John Erickson , president and chief executive officer of Otter Tail Corporation. "Electric segment earnings were consistent with the same quarter a year ago, and increased profits from our manufacturing and food ingredient processing segments offset the anticipated reduction in earnings from our plastics segment. DMI Industries, our manufacturer of wind towers, produced excellent growth for the quarter. We reaffirm our 2007 earnings per share guidance to be within the range of $1.60 to $1.80."

For the nine months ended September 30, 2007 net income from continuing operations was $39.8 million compared with $39.5 million for the nine months ended September 30, 2006 . Diluted earnings per share from continuing operations were $1.31 for both the nine months ended September 30, 2007 and September 30, 2006 .

Segment Performance Summary

Electric

Electric revenues increased 1.3% to $72.1 million in the third quarter of 2007 compared with $71.2 million in the third quarter of 2006 due to increases of $0.6 million in other electric revenues, $0.2 million in retail electric revenues and $0.1 million in net revenues from wholesale sales and energy trading activities, including mark-to-market losses on forward energy contracts. Electric segment third quarter 2007 net income of $6.5 million was unchanged from third quarter 2006 net income.

The main contributor to the increase in other electric revenues was an increase in revenue from electric construction work performed for other companies. The increase in retail revenues reflects $0.5 million related to a 4.1% increase in retail kilowatt-hour (kwh) sales, offset by a $0.3 million decrease in Fuel Clause Adjustment (FCA) revenues related to a 6.6% decrease in fuel and purchased power costs per kwh generated and purchased for system use. The increase in retail kwh sales reflects increased consumption by commercial and pipeline customers. Electric operating expenses, including fuel and purchased power, increased $0.3 million between the quarters mainly as a result of increases of $0.8 million in material costs related to construction work performed for others and $0.4 million in property taxes and depreciation expense related to an increase in plant in service between the quarters, offset by a $0.9 million reduction in fuel and purchased power expenses.

Plastics

The plastics segment's revenues and net income were $37.0 million and $1.4 million, respectively, in the quarter ended September 30, 2007 compared with $45.9 million and $4.6 million in the quarter ended September 30, 2006 . The decrease in revenues and net income is mainly the result of a 19% decline in sales prices between the quarters. The decrease in pipe prices reflects a continuing but anticipated softening of the pipe market.

Manufacturing

The manufacturing segment's revenues and net income were $95.3 million and $3.5 million, respectively, in the quarter ended September 30, 2007 compared with $76.7 million and $2.5 million in the quarter ended September 30, 2006 . DMI Industries, Inc. recorded increases of $15.0 million in revenue and $0.7 million in net income between the quarters as a result of increased production levels and productivity gains. DMI's third quarter 2007 operating expenses include $0.3 million in pre-production start-up costs for its new plant in Tulsa , Oklahoma. At ShoreMaster, Inc., revenues increased $2.6 million and net losses decreased $0.2 million between the quarters as a result of strong commercial sales. The Aviva Sports product line, acquired by ShoreMaster in February 2007 , contributed $0.5 million to the increase in revenues. At BTD Manufacturing, Inc., revenues increased $0.6 million while net income decreased $0.1 million between the quarters. The increase in revenues is primarily related to the acquisition of Pro Engineering in May 2007 . Increases in payroll costs and depreciation expenses at BTD more than offset a $0.3 million increase in gross margins on sales, resulting in the reduction in net income between the quarters. At T.O. Plastics, Inc., revenues increased $0.5 million and net income increased $0.3 million as a result of increased sales volume between the quarters.

Health Services

The health services segment's revenues and net income were $31.4 million and $0.1 million, respectively, in the quarter ended September 30, 2007 compared with $35.4 million and $0.3 million in the quarter ended September 30, 2006 . Revenues from scanning and other related services decreased $2.2 million as a result of fewer interim installations and a 2.8% decrease in scan revenues. Revenues from equipment sales and servicing decreased $1.9 million between the quarters. Cost of goods sold decreased $3.9 million between the quarters. The decrease in equipment sales revenues and cost of goods sold reflect a change in mix between the quarters to more commission-based compensation for sales to customers from traditional dealership distribution of products. A $0.2 million increase in operating and depreciation expenses contributed to the decrease in health services net income between the quarters.