Company: MSEX
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001628280-25-047821
Chunk: 69

Company: MIDDLESEX WATER CO
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 8
Chunk 69
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 that effective PFAS treatment approaches are implemented.

Capital Construction Program - The Company’s multi-year capital construction program encompasses numerous projects designed to upgrade and replace utility infrastructure as well as enhance the integrity and reliability of assets to maintain and improve service for the current and future generations of water and wastewater customers. The Company plans to invest approximately $93 million in 2025 in connection with this plan for projects that include, but are not limited to:

-Replacement of approximately 20 thousand linear feet of cast iron main in Woodbridge Township in our Middlesex System;

-Design and construction of new elevated water tanks in Delaware; and

-Various water main replacements and improvements.

The actual amount and timing of capital expenditures is dependent on project scheduling and refinement of engineering estimates for certain capital projects.

Outlook

Our ability to increase operating income and net income is based significantly on four factors: weather, adequate and timely rate relief, effective cost management and customer growth. Weather patterns which can result in lower customer demand for water may occur at any time. As operating costs are anticipated to increase in 2025 in a variety of categories, we continue to implement plans to further streamline operations and further reduce and mitigate increases in operating costs. Changes in customer water usage habits, as well as increases in capital expenditures and operating costs, are significant factors in determining the timing and extent of rate increase requests.

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Table of Contents

Our investments in system infrastructure continue to grow significantly and our operating costs are anticipated to increase in 2025 and 2026 in a variety of categories. These factors, among others, required a base rate increase request by Middlesex and Pinelands in June 2025.

Overall, organic residential customer growth continues in our Tidewater system (approximately 3.5% in 2024). However, current and evolving economic market conditions may challenge that growth.

Our strategy for selective and sustainable growth is focused on the following key areas:

•Invest in our utility infrastructure to build system resiliency and meet compliance requirements;

•Timely and adequate recovery of infrastructure investments and other costs to maintain and continually improve service quality;

•Selective acquisitions of investor and municipally-owned water and wastewater utilities; and

•Operation of municipal and industrial water and wastewater systems on a contract basis which meet our risk profile.

Operating Results by Segment

The discussion of the Company’s operating results is on a consolidated basis and includes significant factors by subsidiary. The Company has two operating segments, Regulated and Non-Regulated. The operations of the Regulated segment are subject to