Company: MSEX
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001628280-25-047821
Chunk: 89

Company: MIDDLESEX WATER CO
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 2
Chunk 89
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 costs, including income taxes, from the proceeds from a litigation agreement related to the PFAS treatment upgrades at Middlesex’s Park Avenue Plant.

Liquidity and Capital Resources

Operating Cash Flows

Cash flows from operations are largely based on four factors: weather, adequate and timely rate increases, effective cost management and customer growth. The effect of those factors on net income is discussed in “Results of Operations.”

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For the nine months ended September 30, 2025, cash flows from operating activities increased $6.8 million to $44.1 million. The increase in cash flows from operating activities primarily resulted from the impact of Middlesex’s approved base rate increase effective March 1, 2024, Tidewater's base rate increase effective July 3, 2025, Middlesex's increased DSIC  and lower vendor and federal income tax payments.

Investing Cash Flows

For the nine months ended September 30, 2025, cash flows used in investing activities increased $26.8 million to $76.2 million due to increased utility plant expenditures in 2025 and Tidewater’s acquisition of the water utility assets of Ocean View.

For further discussion on the Company’s future capital expenditures and expected funding sources, see “Capital Expenditures and Commitments” below.

Financing Cash Flows

For the nine months ended September 30,  2025, cash flows from financing activities increased $16.8 million to $32.9 million. The increase in cash flows provided by financing activities is due to higher borrowings under the Company’s lines of credit and higher proceeds from the issuance of common stock under Middlesex’s new At -the-Market (ATM) equity offering program (for further information on Middlesex’s At-the-Market equity offering program, see below under Capital Expenditures and Commitments) partially offset by proceeds received from a litigation settlement in 2024.

Capital Expenditures and Commitments

To fund our capital program, we use internally generated funds, short-term and long-term debt borrowings, proceeds from sales of common stock under the Middlesex Water Company Investment Plan and the At-the-Market equity offering program, and when market conditions are favorable, proceeds from sales to the public of our common stock. To the extent possible and fiscally prudent, the Company finances qualifying capital projects under State Revolving Fund (SRF) loan programs in New Jersey and Delaware. These government programs provide financing at interest rates typically below rates