Company: MSEX
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001174947-25-000677
Chunk: 30

Company: MIDDLESEX WATER CO
Filing Date: 2025-05-01
Form: 10-Q
Item: Item 1
Chunk 30
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 upgrades at Middlesex’s Park Avenue Plant
in connection with Middlesex’s 2023 rate case order.

Other Taxes

Other Taxes for the three months ended March 31, 2025
increased $0.3 million from the same period in 2024 primarily due to higher gross receipts taxes on higher revenue in our Middlesex system.

Other Income, net

Other Income, net for the three months ended March
31, 2025 decreased $3.6 million from the same period in 2024 due to lower actuarially-determined retirement benefit plans non-service
benefit and the one-time recovery in 2024 of carrying costs on PFAS treatment upgrades at Middlesex’s Park Avenue Plant in connection
with the Middlesex’s 2023 rate case order.

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Interest Charges

Interest Charges for the three months ended March
31, 2025 decreased $0.6 million from the same period in 2024 due to lower average debt outstanding and lower average interest rates.

Income Taxes

Income Taxes for the three months ended March 31,
2025 decreased by $0.1 million from the same period in 2024, primarily due to lower pre-tax income and higher income tax benefits associated
with increased repair expenditures on tangible property in the Middlesex System offset by the 2024 recovery of income taxes on the taxable
portion of the proceeds from a litigation agreement. The conclusion of Middlesex’s 2023 base rate increase request allowed Middlesex
to recover 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.”

For the three months ended March 31, 2025, cash flows
from operating activities increased $7.1 million to $13.8 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 and timing of vendor payments.

Investing Cash Flows

For the three months ended March 31, 2025, cash flows
used in investing activities increased $4.5 million to $18.9 million due to increased utility plant expenditures in 2024.

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