SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549
(Mark One)
[X]           QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934
                 For the quarterly period ended March 31, 2000

                                    OR
[ ]
            TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                For the transition period from ________ to ________

                        Commission file number 1-11023
                              E'town CORPORATION
             (Exact name of registrant as specified in its charter)
       New Jersey                                         22-2596330
(State of incorporation)                    (I.R.S. Employer Identification No.)
    600 South Avenue
  Westfield, New Jersey                                     07090
(Address of principal executive offices)                  (Zip Code)

         Registrant's telephone number, including area code:    (908) 654-1234

 Title of each class                  Name of each exchange on which registered
Common Stock, without par value                 New York Stock Exchange

                        Commission file number 0-628
                         ELIZABETHTOWN WATER COMPANY
            (Exact name of registrant as specified in its charter)
   New Jersey                                              22-1683171
(State of incorporation)                    (I.R.S. Employer Identification No.)
  600 South Avenue
 Westfield, New Jersey                                      07090
(Address of principal executive offices)                  (Zip Code)

         Registrant's telephone number, including area code:     (908) 654-1234

Title of each class                   Name of each exchange on which registered
Senior Unsecured Debentures                            None
Mandatory Redeemable Preferred Stock                   None

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes __X__ No_____

Indicate the number of shares outstanding of each of the Registrant's classes of
Common Stock as of the latest practicable date
                                                   Outstanding at
 Class of Common Stock:                            March 31, 2000
 E'town Corporation (without par value)              8,793,511
 Elizabethtown Water Company (without par value)*    1,974,902

 * All shares are owned by E'town Corporation
===============================================================================
<PAGE>


                    E'TOWN CORPORATION AND SUBSIDIARIES
               ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY

                                  INDEX


-------------------------------------------------------------------------------

PART I - FINANCIAL INFORMATION                                       PAGE

Item 1. Financial Statements

 E'TOWN CORPORATION AND SUBSIDIARIES

    - Statements of Consolidated Income                                1
    - Consolidated Balance Sheets                                     2-3
    - Statements of Consolidated Capitalization                        4
    - Statements of Consolidated Shareholders' Equity                  5
    - Statements of Consolidated Cash Flows                            6

 ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY

    - Statements of Consolidated Income                                7
    - Consolidated Balance Sheets                                     8-9
    - Statements of Consolidated Capitalization                        10
    - Statements of Consolidated Shareholder's Equity                  11
    - Statements of Consolidated Cash Flows                            12

  E'TOWN CORPORATION AND SUBSIDIARIES AND
  ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY

    - Notes to Consolidated Financial Statements                       13

      Item 2. Management's Discussion and Analysis of Consolidated
              Financial Condition and Results of Operations            20

PART II - OTHER INFORMATION                                            28

      Items 1 - 5

      Item 6 (a) - Exhibits                                            28
             (b) - Reports on Form 8-K                                 28

      SIGNATURES                                                       29
<PAGE>

E'TOWN CORPORATION AND SUBSIDIARIES
(In Thousands Except Per Share Amounts)                Three Months Ended
           (Unaudited)                                       March 31,
                                                          2000      1999

==========================================================================
Operating Revenues                                     $ 38,163  $ 35,476
--------------------------------------------------------------------------
Operating Expenses:
  Operation                                              17,986    14,575
  Maintenance                                             1,901     1,609
  Depreciation and amortization                           4,187     3,674
  Revenue taxes                                           3,956     3,740
  Real estate, payroll and other taxes                    1,101       990
  Federal income taxes                                    1,161     2,213
--------------------------------------------------------------------------
        Total operating expenses                         30,292    26,801
--------------------------------------------------------------------------
Operating Income                                          7,871     8,675
--------------------------------------------------------------------------
Other Income (Expense):
  Allowance for equity funds used during
    construction                                            114        75
  Federal income taxes                                     (147)   (1,243)
  Gain on sale of land (Note 8)                                     3,197
  Other - net                                               323       281
--------------------------------------------------------------------------
        Total other income                                  290     2,310
--------------------------------------------------------------------------
Total Operating and Other Income                          8,161    10,985
--------------------------------------------------------------------------
Interest Charges:
  Interest on long-term debt                              4,438     4,134
  Other interest expense - net                            1,240       291
  Capitalized interest                                      (95)      (53)
  Amortization of debt discount and expense-net             114       110
--------------------------------------------------------------------------
Total interest charges                                    5,697     4,482
--------------------------------------------------------------------------
Income Before Preferred Stock Dividends
   of Subsidiary                                          2,464     6,503
Preferred Stock Dividends                                   203       203
--------------------------------------------------------------------------
Net Income                                             $  2,261  $  6,300
==========================================================================

Earnings Per Share of Common Stock (Note 7):
--------------------------------------------------------------------------
      Basic                                            $   0.26  $   0.74
      Diluted                                          $   0.26  $   0.73
--------------------------------------------------------------------------

Average Number of Shares Outstanding for
   the Calculation of Earnings Per Share:
--------------------------------------------------------------------------
      Basic                                               8,723     8,512
      Diluted                                             9,016     8,797
--------------------------------------------------------------------------

Dividends Paid Per Common Share                        $   0.51  $   0.51
==========================================================================

See Notes to Consolidated Financial Statements.

                                    - 1 -
<PAGE>
E'TOWN CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands)                             March 31,
                                             2000               December 31,
Assets                                    (Unaudited)              1999
--------------------------------------------------------------------------


Utility Plant-At Original Cost:
  Utility plant in service               $ 778,925              $ 779,485
  Construction work in progress             22,684                 17,441
--------------------------------------------------------------------------
        Total utility plant                801,609                796,926
   Less accumulated depreciation           140,713                137,587
--------------------------------------------------------------------------
        Utility plant-net                  660,896                659,339
--------------------------------------------------------------------------


Non-utility Property and Other
  Investments - Net (Note 8)                84,898                 85,163
--------------------------------------------------------------------------


Current Assets:
  Cash and cash equivalents                  9,596                  4,367
  Customer and other accounts receivable
   (less reserve: 2000, $1,327, 1999,
    $1,316)(Note 8)                         31,411                 30,129
  Mortgage and other notes receivable        2,513                  4,600
  Unbilled revenues                         12,302                 12,972
  Infrastructure loan funds
   receivable (Note 5)                       5,657                  5,657
  Materials and supplies-at average cost     4,740                  4,069
  Prepaid federal income taxes               3,993                  4,617
  Prepaid insurance, taxes, other            3,312                  3,663
--------------------------------------------------------------------------
        Total current assets                73,524                 70,074
--------------------------------------------------------------------------


Deferred Charges:
  Waste residual management                  1,474                  1,538
  Unamortized debt and preferred
   stock expenses                            9,467                  9,419
  Taxes recoverable through future rates    13,466                 13,466
  Postretirement benefit expense             3,085                  3,145
  Flood expenditures                         6,604                  5,000
  Other unamortized expenses                 2,098                  1,164
--------------------------------------------------------------------------
        Total deferred charges              36,194                 33,732
--------------------------------------------------------------------------
            Total                        $ 855,512              $ 848,308
==========================================================================

See Notes to Consolidated Financial Statements.


                                     -2-
<PAGE>
E'TOWN CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands)                              March 31,
                                             2000              December 31,
Capitalization and Liabilities             (Unaudited)              1999
--------------------------------------------------------------------------

Capitalization (Notes 4 and 5):
  Common shareholders' equity            $ 230,279              $ 229,233
  Mandatory Redeemable Cumulative
   Preferred Stock                          12,000                 12,000
  Redeemable preferred stock                   227                    227
  Long-term debt - net                     295,500                266,015
--------------------------------------------------------------------------
        Total capitalization               538,006                507,475
--------------------------------------------------------------------------


Current Liabilities:
  Notes payable - banks                     64,000                 89,500
  Long-term debt - current portion (Note 5)    589                    494
  Accounts payable and other liabilities    27,986                 31,434
  Contract obligations payable (Note 5)     19,000                 19,000
  Customers' deposits                          261                    263
  Municipal and state taxes accrued         21,431                 17,682
  Interest accrued                           4,566                  4,219
  Preferred stock dividends accrued             59                     59
--------------------------------------------------------------------------
        Total current liabilities          137,892                162,651
--------------------------------------------------------------------------


Deferred Credits:
  Customers' advances for construction      42,243                 41,321
  Federal income taxes                      71,911                 71,236
  State income taxes                           302                    302
  Unamortized investment tax credits         7,585                  7,636
  Accumulated postretirement benefits        3,457                  3,571
--------------------------------------------------------------------------
        Total deferred credits             125,498                124,066
--------------------------------------------------------------------------


Contributions in Aid of Construction        54,116                 54,116
--------------------------------------------------------------------------


Commitments and Contingent Liabilities
--------------------------------------------------------------------------
                Total                    $ 855,512              $ 848,308
==========================================================================

See Notes to Consolidated Financial Statements.


                                -3-
<PAGE>
E'TOWN CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CAPITALIZATION
(In Thousands Except Share Amounts)                March 31,
                                                     2000          December 31,
                                                  (Unaudited)          1999
-------------------------------------------------------------------------------
Common Shareholders' Equity:
  E'town Corporation:
    Common stock without par value, authorized,
     15,000,000 shares, issued 2000, 8,826,065
     shares; 1999, 8,760,862 shares              $ 183,482          $ 180,124
    Paid-in capital                                  1,215              1,315
    Capital stock expense                           (5,160)            (5,160)
    Retained earnings                               51,710             53,922
    Less cost of treasury stock; 2000 and
     1999, 32,554 shares                              (968)              (968)
------------------------------------------------------------------------------
        Total common shareholders' equity          230,279            229,233
------------------------------------------------------------------------------
Preferred Shareholders' Equity
  Elizabethtown Water Company:
    Mandatory Redeemable Cumulative
     Preferred Stock:
      $100 par value, authorized, 200,000 shares;
       $5.90 series, issued and outstanding,
       120,000 shares                               12,000             12,000
   Cumulative Preferred Stock:
       $25 par value, authorized, 500,000 shares;
        none issued
   Applied Wastewater Management, Inc.:
       Redeemable Preferred Stock:
       No par value, noncumulative, issued and
        outstanding, 227 shares                        227                227
------------------------------------------------------------------------------
        Total preferred shareholders' equity        12,227             12,227
------------------------------------------------------------------------------
Long-term Debt (Notes 5 and 8):
  E'town Corporation:
      6 3/4% Convertible Subordinated Debentures,
       due 2012                                      8,276              8,705
      6.79% Senior Notes, due 2007                  12,000             12,000
      7.69% Senior Notes, due 2010                  30,000
  Applied Wastewater/Applied Water Management:
    6% Note Payable (due serially through 2027)        204                204
    9.65% Mortgage Note Payable (due 2001)             255                264
  Elizabethtown Water Company:
    7.20% Debentures, due 2019                      10,000             10,000
    7 1/2% Debentures, due 2020                     15,000             15,000
    6.60% Debentures, due 2021                      10,500             10,500
    6.70% Debentures, due 2021                      15,000             15,000
    8 3/4% Debentures, due 2021                     27,500             27,500
    8% Debentures, due 2022                         15,000             15,000
    5.60% Debentures, due 2025                      40,000             40,000
    7 1/4% Debentures, due 2028                     50,000             50,000
    Variable Rate Debentures, due 2027              50,000             50,000
  The Mount Holly Water Company:
    New Jersey Environmental Infrastructure Trust
     Notes(due serially through 2018)                6,994              7,040
    New Jersey Department of Environmental
     Protection Notes (due serially through 2018)    5,640              5,677
    9.65% Mortgage Note Payable (due 2001)             153                156
------------------------------------------------------------------------------
        Total long-term debt                       296,522            267,046
    Unamortized (discount) premium-net              (1,022)            (1,031)
------------------------------------------------------------------------------
        Total long-term debt-net                   295,500            266,015
------------------------------------------------------------------------------
           Total Capitalization                  $ 538,006          $ 507,475
==============================================================================

See Notes to Consolidated Financial Statements.

                               -4-
<PAGE>

E'TOWN CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY
(In Thousands Except Share Amounts)
                                         Three Months Ended
                                           March 31,            Year Ended
                                              2000             December 31,
                                           (Unaudited)             1999
------------------------------------------------------------------------------

Common Stock:
  Balance at Beginning of Period                 $ 180,124          $  169,324
  Common stock issued under Dividend
   Reinvestment and Stock Purchase Plan
   (2000, 43,408 shares; 1999, 197,547 shares)       2,630               8,702
  Redemption of Convertible Debentures (2000,
   10,475 shares; 1999, 44,225 shares)                 419               1,769
  Issuance of restricted stock under compensation
   programs (1999, 2,822 shares)                                           119
  Restricted stock (redeemed) in connection with
   acquisitions (1999, (25,756) shares)                                   (867)
  Exercise of stock options (2000, 11,500 shares;
   1999, 37,500 shares                                 309               1,077
------------------------------------------------------------------------------
  Balance at End of Period                         183,482             180,124
------------------------------------------------------------------------------

Paid-in Capital:                                     1,215               1,315
------------------------------------------------------------------------------

Capital Stock Expense:                              (5,160)             (5,160)
------------------------------------------------------------------------------

Retained Earnings:
  Balance at Beginning of Period                    53,922              50,961
  Net Income                                         2,261              20,487
  Dividends on common stock (2000, $.51;
   1999, $2.04)                                     (4,473)            (17,526)
------------------------------------------------------------------------------
  Balance at End of Period                          51,710              53,922
------------------------------------------------------------------------------


Treasury Stock:                                       (968)              (968)
------------------------------------------------------------------------------

     Total Common Shareholders' Equity           $ 230,279           $ 229,233
==============================================================================

See Notes to Consolidated Financial Statements.


                             -5-
<PAGE>
E'TOWN CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
          (In Thousands)                           Three Months Ended
            (Unaudited)                                  March 31,
                                                   2000            1999
-------------------------------------------------------------------------

Cash Flows Provided by Operating Activities:
 Net Income                                       $ 2,261        $ 6,300
 Adjustments to reconcile net income to net
  cash provided by operating activities:
   Depreciation and amortization                    4,187          3,674
   Gain on the sale of land                                       (3,197)
   Increase in deferred charges                    (2,474)          (367)
   Deferred income taxes and investment
    tax credits-net                                   624            844
   Capitalized interest and AFUDC                    (209)          (128)
   Other operating activities-net                    (156)         2,971
 Change in current assets and current liabilities
  excluding cash, short-term investments and
  current portion of debt :
     Customer and other accounts receivable        (1,282)        (2,572)
      Mortgage and other notes receivable           2,087         (3,529)
     Unbilled revenues                                670            (26)
     Accounts payable and other liabilities        (3,450)        (1,165)
     Accrued/prepaid interest and taxes             5,071          8,517
     Other                                           (666)           106
-------------------------------------------------------------------------
     Net cash provided by operating activities      6,663         11,428
-------------------------------------------------------------------------
Cash Flows Provided (Used) by Financing Activities:
 Proceeds from issuance of common stock             2,939          2,153
 Funds held in Trust by others                        (72)           258
 Debt and preferred stock issuance and
  amortization costs                                  (48)           126
 Issuance of other long-term debt                  30,000
 Repayment of long-term debt                           (5)          (243)
 Contributions and advances for construction        1,892          1,728
 Refunds of customer advances for construction       (970)          (448)
 Net decrease in notes payable - banks            (25,500)        (2,038)
 Dividends paid on common stock                    (4,473)        (4,339)
-------------------------------------------------------------------------
    Net cash flows provided (used) by
    financing activities                            3,763         (2,803)
-------------------------------------------------------------------------
Cash Flows Used for Investing Activities:
 Utility plant and other capital expenditures
 (excluding allowance for funds used during
 construction)                                     (5,070)        (9,300)
Capital expenditures on non-regulated property       (127)          (286)
 Proceeds from sale of land                                        2,069
-------------------------------------------------------------------------
    Net cash flows used for investing activities   (5,197)        (7,517)
-------------------------------------------------------------------------
Net Increase in Cash
  and Cash Equivalents                              5,229          1,108
Cash and Cash Equivalents at
  Beginning of Period                               4,367          5,909
-------------------------------------------------------------------------
Cash and Cash Equivalents at End of Period        $ 9,596        $ 7,017
=========================================================================
Supplemental Disclosures of Cash
  Flow Information:
    Cash paid during the year for:
      Interest (net of amount capitalized)        $ 5,365        $ 3,896
      Income taxes                                $     0        $ 1,600
      Preferred stock dividends                   $   177        $   177
   Noncash issuance of common stock               $   419        $   242

See Notes to Consolidated Financial Statements.

                                     -6-
<PAGE>
ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY
STATEMENTS OF CONSOLIDATED INCOME
               (In Thousands)
                  (Unaudited)
                                                           Three Months Ended
                                                                  March 31,
                                                               2000     1999
-----------------------------------------------------------------------------
Operating Revenues                                         $  31,743 $ 31,066
-----------------------------------------------------------------------------
Operating Expenses:
  Operation                                                   12,232   11,591
  Maintenance                                                  1,742    1,456
  Depreciation                                                 3,460    3,197
  Revenue taxes                                                3,929    3,733
  Real estate, payroll and other taxes                           889      883
  Federal income taxes                                         1,655    2,189
-----------------------------------------------------------------------------
        Total operating expenses                              23,907   23,049
-----------------------------------------------------------------------------
Operating Income                                               7,836    8,017
-----------------------------------------------------------------------------
Other Income (Expense):
  Allowance for equity funds used during construction            114       75
  Federal income taxes                                          (126)     (72)
  Other - net                                                    263      128
-----------------------------------------------------------------------------
        Total other income                                       251      131
-----------------------------------------------------------------------------
Total Operating and Other Income                               8,087    8,148
-----------------------------------------------------------------------------
Interest Charges:
  Interest on long-term debt                                   3,776    3,757
  Other interest expense - net                                   913       63
  Allowance for funds used during construction                   (95)     (53)
  Amortization of debt discount and expense-net                   99       98
-----------------------------------------------------------------------------
        Total interest charges                                 4,693    3,865
-----------------------------------------------------------------------------
Net Income                                                     3,394    4,283
Preferred Stock Dividends                                        203      203
-----------------------------------------------------------------------------
Earnings Applicable To Common Stock                        $   3,191 $  4,080
=============================================================================

See Notes to Consolidated Financial Statements.

                                     - 7 -
<PAGE>
ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(In Thousands)                            March 31,
                                            2000              December 31,
Assets                                   (Unaudited)              1999
--------------------------------------------------------------------------

Utility Plant-At Original Cost:
  Utility plant in service               $ 769,871              $ 770,251
  Construction work in progress             22,653                 17,495
--------------------------------------------------------------------------
        Total utility plant                792,524                787,746
  Less accumulated depreciation and
   amortizion                              140,003                136,975
--------------------------------------------------------------------------
        Utility plant-net                  652,521                650,771
--------------------------------------------------------------------------


Non-utility Property (Note 8)                7,409                  7,337
--------------------------------------------------------------------------


Current Assets:
  Cash and cash equivalents                  3,394                  1,342
  Customer and other accounts receivable
   (less reserve: 2000, $683, 1999, $674)   17,903                 19,341
  Unbilled revenues                         10,022                 10,578
  Infrastructure loan funds
   receivable (Note 5)                       5,657                  5,657
  Materials and supplies-at average cost     4,740                  4,069
  Prepaid federal income taxes               5,108                  5,807
  Prepaid insurance, taxes, other            3,043                  3,229
--------------------------------------------------------------------------
        Total current assets                49,867                 50,023
--------------------------------------------------------------------------


Deferred Charges:
  Waste residual management                  1,474                  1,538
  Unamortized debt and preferred
   stock expenses                            8,785                  8,900
  Taxes recoverable through future rates    13,466                 13,466
  Postretirement benefit expense             3,085                  3,145
  Flood expenditures                         6,604                  5,000
  Other unamortized expenses                 1,836                  1,007
--------------------------------------------------------------------------
        Total deferred charges              35,250                 33,056
--------------------------------------------------------------------------
            Total                        $ 745,047              $ 741,187
==========================================================================

See Notes to Consolidated Financial Statements.

                                   - 8 -
<PAGE>
ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(In Thousands)                            March 31,
                                           2000                December 31,
Capitalization and Liabilities          (Unaudited)               1999
--------------------------------------------------------------------------


Capitalization (Note 4):
  Common shareholder's equity            $ 221,809              $ 220,461
  Mandatory redeemable cumulative
  preferred stock                           12,000                 12,000
  Long-term debt - net                     244,765                244,842
--------------------------------------------------------------------------
        Total capitalization               478,574                477,303
--------------------------------------------------------------------------


Current Liabilities:
  Notes payable - banks                     56,500                 51,500
  Long-term debt - current portion             567                    481
  Accounts payable and other liabilities    12,226                 19,989
  Customers' deposits                          194                    197
  Municipal and state taxes accrued         21,303                 17,592
  Interest accrued                           3,872                  3,745
  Preferred stock dividends accrued             59                     59
--------------------------------------------------------------------------
        Total current liabilities           94,721                 93,563
--------------------------------------------------------------------------


Deferred Credits:
  Customers' advances for construction      41,031                 40,019
  Federal income taxes                      70,159                 69,570
  Unamortized investment tax credits         7,585                  7,636
  Accumulated postretirement benefits        3,280                  3,399
--------------------------------------------------------------------------
        Total deferred credits             122,055                120,624
--------------------------------------------------------------------------


Contributions in Aid of Construction        49,697                 49,697
--------------------------------------------------------------------------


Commitments and Contingent Liabilities
--------------------------------------------------------------------------
                Total                    $ 745,047              $ 741,187
==========================================================================

See Notes to Consolidated Financial Statements.

                                    - 9 -
<PAGE>
ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY
STATEMENTS OF CONSOLIDATED CAPITALIZATION
(In Thousands)                             March 31,
                                              2000              December 31,
                                           (Unaudited)              1999
--------------------------------------------------------------------------

Common Shareholder's Equity (Note 4):
  Common stock without par value, authorized,
   15,000,000 shares,issued 2000 and 1999,
   1,974,902 shares                              $  15,741          $  15,741
  Paid-in capital                                  144,205            141,575
  Capital stock expense                               (485)             (485)
  Retained earnings                                 62,348             63,630
-----------------------------------------------------------------------------
      Total common shareholder's equity            221,809            220,461
-----------------------------------------------------------------------------

Preferred Shareholders' Equity:
 Mandatory Redeemable Cumulative Preferred Stock
   $100 par value, authorized, 200,000 shares;
   $5.90 series, issued and outstanding, 120,00
   shares                                           12,000             12,000

 Cumulative Preferred Stock:
   $25 par value, authorized, 500,000 shares;
    none issued
-----------------------------------------------------------------------------

 Long-term Debt:
  Elizabethtown Water Company:
    7.20% Debentures, due 2019                      10,000             10,000
    7 1/2% Debentures, due 2020                     15,000             15,000
    6.60% Debentures, due 2021                      10,500             10,500
    6.70% Debentures, due 2021                      15,000             15,000
    8 3/4% Debentures, due 2021                     27,500             27,500
    8% Debentures, due 2022                         15,000             15,000
    5.60% Debentures, due 2025                      40,000             40,000
    7 1/4% Debentures, due 2028                     50,000             50,000
   Variable Rate Debentures, due 2027               50,000             50,000
  The Mount Holly Water Company:
    New Jersey Environmental Infrastructure Trust
     Notes (due serially through 2018)               6,994              7,040
    New Jersey Department of Environmental
     Protection Notes (due serially through 2018)    5,640              5,677
    9.65% Mortgage Note Payable (due 2001)             153                156
-----------------------------------------------------------------------------
        Total long-term debt                       245,787            245,873
    Unamortized discount-net                        (1,022)            (1,031)
-----------------------------------------------------------------------------
        Total long-term debt-net                   244,765            244,842
-----------------------------------------------------------------------------
           Total Capitalization                  $ 478,574          $ 477,303
=============================================================================

See Notes to Consolidated Financial Statements.

                                     -10-
<PAGE>
ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY
STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY
(In Thousands)
                                               Three Months Ended
                                                 March 31,          Year Ended
                                                   2000             December 31,
                                                (Unaudited)             1999
--------------------------------------------------------------------------------


Common Stock:                                    $  15,741          $   15,741
--------------------------------------------------------------------------------

Paid-in Capital:
  Balance at Beginning of Period                   141,575             132,753
  Capital Contributed by Parent Company from:
     Common Stock Issued Under Dividend
      Reinvestment and Stock Purchase Plan           2,630               8,702
     Issuance of Restricted and Unrestricted
      Stock Under Compensation Programs                                    120
--------------------------------------------------------------------------------
  Balance at End of Period                         144,205             141,575
--------------------------------------------------------------------------------

Capital Stock Expense                                 (485)               (485)
--------------------------------------------------------------------------------

Retained Earnings:
  Balance at Beginning of Period                    63,630              60,564
  Net income                                         3,394              21,405
  Dividends on common stock                         (4,473)            (17,526)
  Dividends on preferred stock                        (203)               (813)
--------------------------------------------------------------------------------
  Balance at End of Period                          62,348              63,630
--------------------------------------------------------------------------------

     Total Common Shareholder's Equity           $ 221,809          $  220,461
================================================================================

See Notes to Consolidated Financial Statements.

                                     -11-
<PAGE>
ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY
STATEMENTS OF CONSOLIDATED CASH FLOWS
               (In Thousands)
                  (Unaudited)                           Three Months Ended
                                                            March 31,
                                                          2000      1999
--------------------------------------------------------------------------------
Cash Flows from Operating Activities:
 Net income                                       $ 3,394        $ 4,283
 Adjustments to reconcile net income to net
  cash provided by operating activities:
    Depreciation and amortization                   3,460          3,197
    Increase in deferred charges                   (2,369)          (484)
    Deferred income taxes and investment tax
      credits-net                                     538            832
    Allowance for funds used during construction     (209)          (128)
    Other operating activities-net                    (50)           (16)
 Change in current assets and current liabilities
  excluding cash, short-term investments and
  current portion of debt :
      Customer and other accounts receivable        1,438         (1,279)
      Unbilled revenues                               556            141
      Accounts payable and other liabilities       (7,766)        (2,365)
      Accrued/prepaid interest and taxes            4,723          7,299
      Other                                          (697)           106
--------------------------------------------------------------------------------
      Net cash provided by operating activities     3,018         11,586
--------------------------------------------------------------------------------

Cash Flows Provided (Used) by Financing Activities:
 Capital contributed by parent company              2,630          2,067
 Funds held in Trust by others                        (72)           258
 Debt and preferred stock issuance and
   amortization costs                                 115            114
 Repayment of long-term debt                                          (7)
 Contributions and advances for construction        1,982          1,728
 Refunds of customer advances for construction       (970)          (418)
 Net increase (decrease) in notes payable - banks   5,000         (2,000)
 Dividends paid on common stock and
  preferred stock                                  (4,650)        (4,516)
--------------------------------------------------------------------------------
     Net cash provided (used) by
      financing activities                          4,035         (2,774)
--------------------------------------------------------------------------------

Cash Flows Used for Investing Activities:
 Utility plant expenditures (excluding allowance
  for funds used during construction)              (5,001)        (8,205)
--------------------------------------------------------------------------------
    Cash used for investing activities             (5,001)        (8,205)
--------------------------------------------------------------------------------
Net Increase in Cash and
  Cash Equivalents                                  2,052            607
Cash and Cash Equivalents at
  Beginning of Period                               1,342          3,598
--------------------------------------------------------------------------------
Cash and Cash Equivalents at End of Period        $ 3,394        $ 4,205
================================================================================
Supplemental Disclosures of Cash
  Flow Information:
    Cash paid during the year for:
     Interest (net of amount capitalized)         $ 4,499        $ 2,795
     Income taxes                                 $     0        $ 1,600
     Preferred stock dividends                    $   177        $   177
See Notes to Consolidated Financial Statements.

                                          -12-
<PAGE>
                      E'TOWN CORPORATION AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  ORGANIZATION
    E'town Corporation (E'town), a New Jersey holding company, is the parent
    company of Elizabethtown Water Company (Elizabethtown or Company), Edison
    Water Company (Edison), E'town Properties, Inc. (Properties), Liberty
    Water Company (Liberty), Applied Water Management, Inc. (AWM) and Applied
    Wastewater Management, Inc. (AWWM). The Mount Holly Water Company (Mount
    Holly) is a wholly-owned subsidiary of Elizabethtown. The Corporation and
    its subsidiaries as a consolidated entity are referred to herein as the
    Corporation.  The assets and operating results of Elizabethtown constitute
    the predominant portions of E'town's assets and operating results. The
    regulated utilities, Elizabethtown, Mount Holly and AWWM, comprise the
    Regulated Utilities segment, Liberty and Edison comprise the Contract
    Operations segment, AWM is the Engineering/Operations and Construction
    segment and E'town and Properties comprise the Financing and Investment
    segment.

2.  PENDING MERGER
    On November 21, 1999, E'town entered into an agreement (Merger Agreement)
    with Thames Water Plc (Thames Water) under which Thames Water has agreed,
    subject to certain conditions, to acquire E'town for $68 per share in cash
    or approximately $607 million. Thames Water will also assume the debt of
    the Corporation. The acquisition will take the form of a merger (Merger)
    of E'town with a newly formed subsidiary of Thames Water and E'town will
    be the surviving company.

    A special meeting of shareholders will be held on May 18, 2000 to
    seek shareholder approval of the transaction. The review of the
    acquisition by the Federal Trade Commission and the Department of
    Justice under the Hart-Scott-Rodino Antitrust Improvement Act of
    1976 has been completed. The acquisition is subject to approval
    by the New Jersey Board of Public Utilities (BPU). Certain
    clearances must also be obtained from the New Jersey
    environmental regulators. The transaction is expected to close
    prior to the end of 2000.

3.  INTERIM FINANCIAL STATEMENTS
    The financial statements reflect all adjustments which, in the opinion of
    management, are necessary for a fair presentation. The Notes to
    Consolidated Financial Statements accompanying the 1999 Annual Report to
    Shareholders and the 1999 Form 10-K should be read in conjunction with
    this report.

    The preparation of financial statements in conformity with generally
    accepted accounting principles requires management to make estimates and
    assumptions that affect the reported amounts of assets and liabilities
    and disclosure of contingent assets and liabilities at the date of the
    financial statements and the reported amounts of revenues and expenses
    during the reporting period.

                                 -13-
<PAGE>
    New Accounting Pronouncements
    In 1998, the Financial Accounting Standards Board (FASB) issued Statement
    of Financial Accounting Standards (SFAS) No. 133, "Accounting for
    Derivative Instruments and Hedging Activity". In June 1999, the FASB
    issued SFAS No. 137, "Accounting for Derivative Instruments and Hedging
    Activity - Deferral of the Effective Date of SFAS No. 133" to defer the
    effective date of SFAS No. 133 for one year. Consequently, SFAS No. 133
    will now be effective for all fiscal quarters of all fiscal years
    beginning after June 15, 2000. The Corporation does not believe this
    Statement will have any impact on  the Corporation's financial condition
    and results of operations.

4.  CAPITALIZATION
    E'town routinely makes equity contributions to Elizabethtown from the
    proceeds of common stock issued under E'town's Dividend Reinvestment and
    Stock Purchase Plan (DRP).  E'town contributed $2.63 million from the DRP
    proceeds to Elizabethtown for the three months ended March 31, 2000.

5.  LONG-TERM DEBT
    In February 2000, E'town issued $30 million of 7.69% Senior Notes due 2010
    in a private placement.  The proceeds were used to repay short-term debt
    incurred to finance the acquisition of the contract to operate the water
    system of the city of Elizabeth and capital expenditures for the
    non-regulated subsidiaries.

    E'town has outstanding $12 million of 6.79% Senior Notes due December 15,
    2007. The Note Agreements for E'town's 6.79% and 7.69%  Senior Notes
    require the maintenance of a consolidated fixed charges coverage ratio of
    at least 1.5 to 1 and a debt to total capitalization ratio not to exceed
    .65 to 1.  As of March 31, 2000, the fixed charges coverage ratio was 2.22
    to 1 and the debt to total capitalization ratio was .62 to 1, calculated
    in accordance with the Note Agreements.

    The aggregate maturities of the Corporation's long-term  debt  (including
    the portion classified as current  and contract obligations payable) as of
    December 31, 1999 for each of the succeeding five years are: 2000, $19.49
    million; 2001, $1.00 million; 2002, $.59 million; 2003, $.60 million and
    2004, $.61 million.   Included in the Corporation's amounts are
    Elizabethtown's  aggregate long-term debt maturities for each of the five
    years succeeding December 31, 1999 : 2000, $.48 million; 2001, $.72
    million; 2002, $.58 million; 2003, $.59 million and 2004, $.60 million.

    In November 1998 Mount Holly closed on loan agreements that will make
    available up to $13.19 million in proceeds from the issuance of unsecured
    notes through the New Jersey Environmental Infrastructure Trust Financing
    Program. This program provides financing through two loans. The first
    loan, in the amount of $7.30 million, is through the New Jersey
    Environmental Infrastructure Trust (Trust), which issued tax-exempt bonds
    with average interest rates of 4.7%. The second loan, in the amount of
    $5.89 million, is from the State of New Jersey, acting through the New
    Jersey Department of Environmental Protection. The State is participating
    in the Safe Drinking Water State Revolving Fund authorized by the Safe
    Drinking Water Act amendments of 1996 whereby the federal government is
    funding the state loan at no interest cost. The effective interest rate
    for the combined notes is approximately 2.59%. The proceeds of the loans
    will be used to repay short-term debt incurred to finance the Mansfield
    Project, a construction project  that was  undetaken  to comply with New
    Jersey legislative restrictions to obtain an alternative water supply to
    reduce pumpage from an aquifer and was fully in service in late December
    1999 .  The Company expects to request these funds from the Trust in the
    second quarter of 2000.

 6. LINES OF CREDIT
    E'town has $115 million of uncommitted lines of credit with several banks,
    of which up to $55 million is available for use by its unregulated
    subsidiaries and $90 million is available to Elizabethtown.  Of the lines
    available to Elizabethtown, $10 million represents a committed line of
    credit.  These lines, together with internal funds and proceeds from the
    sale of E'town's common stock or capital contributions from Thames Water
    after the pending Merger, medium-term notes, long-term debt, proceeds of
    tax-exempt New Jersey Economic Development Authority (NJEDA) bonds and
    short-term borrowings are expected to be sufficient to finance the
    Corporation's capital needs.

                                  -14-
<PAGE>
7.  EARNINGS PER SHARE
    Basic earnings per share are computed on the basis of the weighted average
    number of shares outstanding. Diluted earnings per share assumes both the
    conversion of the 6 3/4% Convertible Subordinated Debentures and common
    stock equivalents, assuming all stock options are exercised. The
    calculations of basic and diluted earnings per share for the three months
    ended March 31, 2000 and 1999 follow:

                                    Three Months Ended
                                          March 31,

    In Thousands of Dollars           2000         1999
    ----------------------------------------------------
    Except Per Share Amounts
    Basic:
    Net Income                      $2,261      $6,300
    Average common shares            8,723       8,512
    outstanding
    ----------------------------------------------------
    Basic earnings per share        $  0.26     $  0.74
    ====================================================
    Diluted:
    Net income                      $2,261      $6,300
    After tax interest expense
    applicable to 6 3/4%
    Convertible Subordinated
        Debentures                   92          112
    ----------------------------------------------------
    Adjusted net income             $2,353      $6,412
    ====================================================
    Average common shares            8,723       8,512
    outstanding
    Additional shares from              32          25
    assumed exercise of
    stock options
     Additional shares from            261         260
    assumed conversion
    of  6 3/4% Convertible
    Subordinated
    Debentures
    Average common shares            9,016       8,797
    outstanding as
    adjusted
    ----------------------------------------------------
    Diluted earnings per share      $  0.26     $  0.73
    ====================================================


8.  NON-UTILITY PROPERTY AND OTHER INVESTMENTS
    The  detail  of  amounts   included  in  Non-Utility   Property  and  Other
    Investments at March 31, 2000 and December 31, 1999 is as follows:

    Thousands of Dollars                                   2000       1999
    ------------------------------------------------------------------------
    Except Per Share Amounts

    Funds held in trust by others                        $ 7,336     $ 7,264
    Other capital assets                                      73          73
    ------------------------------------------------------------------------
    Total Elizabethtown Water & Subsidiary                 7,409       7,337
    Concession fees on privatization contracts - net
     of amortization                                      53,555      53,946
    Capital assets from privatization contracts - net
     of amortization                                       6,209       6,165
    Investments in real estate                             9,048       9,049
    Goodwill on AWM and AWWM acquisitions - net of
     amortization                                          4,995       5,036
    Investment in SEGS                                     1,089       1,089
    Other capital assets                                   2,411       2,356
    Other                                                    182         185
    ------------------------------------------------------------------------
    Total E'town Corporation & Subsidiaries              $84,898     $85,163
    ========================================================================

                                  -15-
<PAGE>
    E'town,  through Liberty, has a 40-year privatization agreement , entered
    into in July 1998  with the city of Elizabeth (Elizabeth), New Jersey to
    operate its water system which  serves approximately 17,600 customers.
    Under the contract, Liberty made concession payments to Elizabeth of $19.7
    million in 1998 and $12 million in 1999 and is obligated to make a
    concession payment of $19 million in June 2000.  These concession fee
    payments are being amortized on a straight-line basis over the life of the
    contract and are included in the table above  Under the terms of the
    contract, Liberty will deposit  $57.8 million from customer collections
    over the 40-year contract into a fund administered by Elizabeth (Fund
    Deposits), of which $52.3 million is due after 2012.  Elizabeth will use
    the Fund Deposits to pay for capital improvements or for other water
    system purposes.  As these funds will be controlled by Elizabeth, they
    will be accounted for as a pass-through from customers to Elizabeth and
    will not be included in revenues or expenses of Liberty. Liberty is
    responsible for $7.45 million of construction expenditures, primarily for
    meter replacements, over the life of the contract as well as for all
    operating expenses .  Of the construction commitments, approximately $2.45
    million is expected to be expended in the next three years.  The
    accumulated amortization of concession fees on privatization contracts and
    on capital assets from privatization contracts were $2.3 million and $1.9
    million as of March 31, 2000 and December 31, 1999, respectively.  Over
    the life of the contract, Liberty  will bill the customers of the water
    system in accordance with rate increases set forth in the contract and
    receive all revenues except for the Fund Deposits .  E'town has guaranteed
    Liberty's performance of  the contract provisions.

    Liberty also performs the commercial billing operations for the wastewater
    system of Elizabeth and remits all cash collected to Elizabeth. Liberty
    does not operate the  wastewater system. Included in the Consolidated
    Balance Sheets of the Corporation as Customer and Other Accounts
    Receivable at March 31, 2000 and December 31, 1999 are the receivables
    from the customers of Elizabeth for wastewater services in the amount of
    $4.70 million and $5.05 million, respectively. An equal amount of
    liability to Elizabeth is included in  Accounts Payable and Other
    Liabilities to reflect Liberty's obligation to remit these funds to
    Elizabeth as collected.

    E'town, through Edison, has a 20-year privatization agreement, entered
    into in June 1997,  with the township of Edison, New Jersey to operate its
    water system which  serves approximately 11,500 customers. Under the
    terms of the contract, Edison bills and receives all water revenues
    generated as a result of operating the water system of the township of
    Edison and pays all the operating expenses. Edison expects to make
    expenditures of approximately $25 million during the 20-year life of the
    contract of which $12.61 million has been spent as of March 31, 2000.
    Construction expenditures, as they are incurred, are being amortized on a
    straight-line basis over the remaining life of the contract.  Expenditures
    include capital improvements to the water system as well as contract
    payments to the township of Edison.  Of the total, approximately $2.94
    million is expected to be expended in the next three years of the
    contract.  An initial payment of $5.7 million was made upon the closing
    and has been included in the table above. The accumulated amortization of
    concession fees on privatization contracts and on capital assets from
    privatization contracts were $1.2 million and $1.1 million as of March 31,
    2000 and December 31, 1999, respectively.  E'town has guaranteed Edison's
    performance of the contract provisions.

    If the Elizabeth or Edison contracts were terminated by either the
    township of Edison or the city of Elizabeth, the unamortized balance of
    the concession fees and amounts paid for additional capital improvements
    would be refunded to Liberty and Edison in accordance with the contracts

    Included in Non-Utility Property and Other Investments at March 31, 2000
    and December 31, 1999 are $9.05 million of investments in various
    parcels of undeveloped land in New Jersey. In February 1999,
    Properties sold a parcel of land which had been under contract since
    1995 in Green Brook, New Jersey for $5.83 million, at a gain of $2.00
    million net of taxes. Cash proceeds of $1.99 million were received in

                                  -16-
<PAGE>
    1999. The remaining $4.33 million was financed with a 7.75% mortgage,
    to be paid over 2 years. The mortgage balance, including accrued
    interest, of $1.92 million is included in Mortgage and other notes
    receivable in the Corporation's Consolidated Balance Sheet as of March
    31, 2000. Properties sold a small parcel in Clinton, New Jersey in
    1999 for $.6 million at a gain of less than $.1 million net of taxes.
    The sale proceeds are being invested into water and wastewater
    projects. Properties has entered into contracts for sale for all of
    its remaining parcels. The eventual sale of these parcels is
    contingent upon the purchaser obtaining various approvals for
    development. This process could take up to several years. Based upon
    the expected sales prices for these properties under the contracts,
    the estimated net realizable value of each property exceeds its
    respective carrying value as of March 31, 2000.

    Included in Non-Utility Property and Other Investments at March 31, 2000
    and December 31, 1999 is an investment of $1.09 million ($.35 million net
    of related deferred taxes) in a limited partnership that owns Solar
    Electric Generating System V (SEGS), located in California.  E'town owns a
    3.19% interest in SEGS. The investment is being accounted for on the
    equity  method. E'town continues to monitor the relationship between the
    carrying and net realizable values of its investment in SEGS, based upon
    information provided by SEGS management as well as through cash flow
    analyses.

    During 1999 AWM made certain investments in non-regulated  wastewater
    assets for $1.7 million. Of this amount $1.2 million was recorded as other
    capital assets and $.5 million was recorded as goodwill. The goodwill is
    being amortized over 10 years.

9.  REGULATORY MATTERS
    MOUNT HOLLY
    In December 1999, Mount Holly completed a construction project, called the
    Mansfield Project, to comply with New Jersey legislative restrictions to
    obtain alternative water supplies, thereby reducing its water pumpage from
    an aquifer, which had been subject to over-pumping by Mount Holly and
    various local purveyors in a portion of southern New Jersey.

    Effective January 1, 2000, Mount Holly received an increase in annual
    rates of $1.88 million. This increase included costs for the Mansfield
    Project. After elimination of a purchased water adjustment clause (PWAC),
    the net rate increase was $.51 million. This increase also reflects
    additional construction and financing costs, as well as higher operating
    costs since base rates were last established in January 1996.

    In June 1999, Mount Holly purchased Homestead Water Utility, Inc. and AWWM
    purchased  Homestead Treatment Utility, Inc. for a combined cash price of
    $1.8 million. The entities provide water and wastewater services to
    approximately 800 customers of the Homestead community in southern New
    Jersey. The transactions were accounted for as purchases.

                                  -17-
<PAGE>
10. SEGMENT REPORTING
    SFAS No. 131, "Disclosures about Segments of an Enterprise and Related
    Information," requires that companies disclose segment data based upon how
    management makes decisions, allocates resources and measures performance.
    Segment data for the three month
    periods ended March 31, 2000 and 1999 is presented as follows :

                                                Three Months Ended
                                                     March 31,

    In Thousands of Dollars                     2000         1999
    ---------------------------------------------------------------
    Operating Revenues:
    Regulated Utilities                      $ 31,938      $ 31,117
    Contract Operations                         4,869         4,774
    Engineering/Operations and Construction     3,304         1,514
    Intersegment Elimination                   (1,948)       (1,929)
    ---------------------------------------------------------------
    Consolidated Operating Revenues          $ 38,163      $ 35,476
    ===============================================================

    Operating Expenses:
    Regulated Utilities                      $ 24,074      $ 23,128
    Contract Operations                         4,241         3,990
    Engineering/Operations and Construction     3,731         1,438
    Financing & Investment                        194           174
    Intersegment Elimination                   (1,948)       (1,929)
    ---------------------------------------------------------------
    Consolidated Operating Expenses          $ 30,292      $ 26,801
    ===============================================================

    Interest Expense:
    Regulated Utilities                      $  4,731      $  3,866
    Contract Operations                           427           290
    Engineering/Operations and Construction        45
    Financing & Investment                        494           326
    ---------------------------------------------------------------
    Consolidated Interest Expense            $  5,697      $  4,482
    ===============================================================

    Depreciation and Amortization Expense:
    Regulated Utilities                      $  3,550      $  3,224
    Contract Operations                           477           401
    Engineering/Operations and Construction       130            11
    Financing & Investment                         30            38
    ---------------------------------------------------------------
    Consolidated Depreciation and
     Amortization Expense                    $  4,187      $  3,674
    ===============================================================

    Net Income (Loss):
    Regulated Utilities                      $  3,178      $  4,056
    Contract Operations                           232           521
    Engineering/Operations and Construction      (472)           75
    Financing & Investment                       (677)        1,648
    ---------------------------------------------------------------
    Consolidated Net Income                  $  2,261      $  6,300
    ===============================================================

                                  -18-
<PAGE>

                                  Total Assets              Total Debt
    --------------------------------------------------------------------------
                              As of        As of         As of       As of
                            March 31,   December 31,   March 31,   December 31,
                               2000        1999          2000         1999
    --------------------------------------------------------------------------

    Regulated Utilities      $754,472    $750,690      $304,407     $299,398
    Contract Operations        75,132      72,921        44,323       44,624
    Engineering/Operations
     and Construction           8,141       7,506         2,992        2,067
    Financing & Investment     54,271      51,574        61,776       59,660
    Intersegment Elimination  (36,504)    (34,383)      (34,409)     (30,740)
    --------------------------------------------------------------------------
    Consolidated Total       $855,512    $848,308      $379,089     $375,009
    ==========================================================================


11. OTHER MATTERS
    In September 1999, Elizabethtown  withdrew its primary water treatment
    plant, the Raritan-Millstone Water Treatment Plant (Plant), from service
    as a result of flooding from Tropical Storm Floyd (Floyd). For several
    days, Elizabethtown had difficulty maintaining adequate water pressure in
    portions of its distribution system because overall system production
    levels were substantially less than normal. Customers in portions of a few
    municipalities were without water service for approximately 3 days. Costs
    incurred to repair and replace equipment damaged by the flood and to
    respond to inquiries by customers, regulatory bodies and the media have
    been deferred and are expected to be recoverable through insurance. The
    Company has incurred $8.6  million of flood-related expenditures and has
    received an advanced reimbursement of $2.0 million from its insurance
    carrier. The remaining $6.6 million of flood-related expenditures is
    reported on the Consolidated Balance Sheet as a deferred charge at March
    31, 2000   (see Note 12 for legal matters related to Floyd).

12. LEGAL MATTERS
    On September 23, 1999, two parties filed separate class action lawsuits
    for compensatory damages and related fees on behalf of themselves and
    similarly situated residential and commercial customers against
    Elizabethtown Water Company, Edison Water Company and Liberty Water
    Company. The lawsuit alleges breach of contract, breach of tariff,
    negligence and products liability regarding the quantity and quality of
    water services provided by the Corporation during the period in September
    1999 when Elizabethtown's Plant was flooded from Floyd and was withdrawn
    from service for approximately 3 days. Elizabethtown has notified its
    insurance carrier of the lawsuit and has filed a motion for summary
    judgment to dismiss the lawsuit as a class action proceeding prior to
    answering the allegations.  In March 2000, the New Jersey Superior Court
    (NJSC) ruled that in the event the lawsuit is not dismissed, the case be
    referred to the BPU for purposes of investigating the matter and reporting
    its findings to the NJSC. The NJSC, in view of the BPU's findings, will
    then determine what, if any, damages were suffered by the plaintiffs and
    what liability rests with Elizabethtown.  Although the insurance carrier
    does not provide coverage for breach of contract and limits its liability
    coverage for breach of tariff, the Corporation maintains that plaintiffs'
    allegations are without merit and believes that the plaintiffs' chances of
    prevailing are not probable and that those allegations specifically not
    covered by insurance pose immaterial liability.

                                  -19-
<PAGE>
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
           CONSOLIDATED FINANCIAL CONDITION AND RESULTS OF OPERATIONS

      E'town Corporation (E'town), a New Jersey holding company, is the parent
      company of Elizabethtown Water Company (Elizabethtown or Company),
      Edison Water Company (Edison), E'town Properties, Inc. (Properties),
      Liberty Water Company (Liberty), Applied Water Management, Inc. (AWM)
      and Applied Wastewater Management, Inc. (AWWM). The Mount Holly Water
      Company (Mount Holly) is a  wholly-owned subsidiary of Elizabethtown.
      The assets and operating results of Elizabethtown constitute the
      predominant portions of E'town's assets and operating results. Mount
      Holly, Liberty, AWM and Edison contributed 3.2%, 5.4%, 7.4% and 1.6%,
      respectively, of the Corporation's consolidated operating revenues for
      1999. Reference to the Corporation and its subsidiaries as a
      consolidated entity is referred to herein as E'town. The regulated
      utilities, Elizabethtown, Mount Holly and AWWM, comprise the Regulated
      Utilities segment, Liberty and Edison comprise the Contract Operations
      segment, AWM is the Engineering/Operations and Construction segment and
      E'town and Properties comprise the Financing and Investment segment (See
      Note 10 to E'town's Notes to Consolidated Financial Statements). The
      following analysis sets forth significant events affecting the financial
      condition of the various segments at March 31, 2000 and the results of
      operations for the three month periods ended March 31, 2000 and 1999.

      PENDING MERGER
      On November 21, 1999, E'town entered into an agreement (Merger
      Agreement)  with Thames Water Plc (Thames Water) under which Thames
      Water has agreed, subject to certain conditions, to acquire E'town for
      $68 per share in cash or approximately $607 million. Thames Water will
      also assume the debt of the Corporation. The acquisition will take the
      form of a merger (Merger) of E'town with a newly formed subsidiary of
      Thames Water and E'town will be the surviving company.

      A special meeting of shareholders  will be held on May 18, 2000 to  seek
      shareholder approval of the transaction. The review of the acquisition
      has been approved by the Federal Trade Commission and the Department of
      Justice under the Hart-Scott-Rodino Antitrust Improvement Act of 1976
      has been completed. The acquisition is  subject to approval by the New
      Jersey Board of Public Utilities (BPU). Certain clearances must also be
      obtained  from the New Jersey environmental regulators. The transaction
      is expected to close prior to the end of 2000.

      LIQUIDITY AND CAPITAL RESOURCES
      Capital Expenditures Program
      For the three months ended March 31, 2000, capital expenditures were
      $5.2 million, principally comprised of other additions and improvements
      to water utility plant and wastewater facilities. For the three years
      ending December 31, 2002, capital and investment requirements for the
      Corporation are estimated to be $171.4 million, consisting of  (i)
      expenditures for the Regulated Utilities Segment ($135.1 million for
      Elizabethtown, $4.7 million for Mount Holly and $5.2 million for AWWM),
      (ii) investments in the Contract Operations segment for concession
      payments by Liberty and capital improvements for Liberty and Edison of
      $24.4 million, and (iii) investments in the  Engineering/Operations and
      Construction segment of $2.0 million. These estimates do not include any
      amounts for possible additional acquisitions or privatization activities
      in the three-year period.

                                  -20-
<PAGE>
      REGULATED UTILITIES SEGMENT
      Elizabethtown
      Elizabethtown's three-year capital program includes $62.0 million for
      routine projects (services, hydrants, system rehabilitation and main
      extensions not funded by developers) and $73.1 million for transmission
      system upgrades, a new operations center, expansion of the Canal Road
      Water Treatment Plant (Canal Road) and other projects. Canal Road will
      be expanded to provide for enhanced system reliability and to
      accommodate customer growth. Canal Road was designed as a 40 million
      gallon per day (MGD) plant, expandable to 200 MGD.

      Mount Holly
      During the next three years, Mount Holly expects to spend $4.7 million,
      of which $3.3 million is for routine projects (services, hydrants and
      main extensions not funded by developers).

      In December 1999, Mount Holly completed a construction project, called
      the Mansfield Project, to comply with New Jersey legislative
      restrictions to obtain alternative water supplies, thereby reducing its
      water pumpage from an aquifer, which had been subject to over-pumping by
      Mount Holly and various local purveyors in a portion of southern New
      Jersey.

      Effective January 1, 2000, Mount Holly received an increase in annual
      rates of $1.88 million. This increase included costs for the Mansfield
      Project. After elimination of a purchased water adjustment clause
      (PWAC), the net rate increase was $.51 million. This increase also
      reflects additional construction and financing costs, as well as higher
      operating costs since base rates were last established in January 1996.

      AWWM
      AWWM expects to incur capital expenditures of $5.2 million in the next
      three years for purchases of wastewater plants from developers.

      CONTRACT OPERATIONS SEGMENT
      LIBERTY
      Under the contract to operate the water system of the city of Elizabeth,
      New Jersey, Liberty made payments to Elizabeth of $19.7 million in 1998
      and $12.0 million in June 1999 and is contractually obligated to make a
      payment to Elizabeth of $19 million in June 2000. Under the terms of the
      contract, Liberty will deposit $57.8 million from revenues earned during
      the 40-year contract, of which $52.3 million is due after 2012, into a
      fund administered by Elizabeth (Fund Deposits).   Elizabeth will use the
      Fund Deposits  to pay for capital improvements or for other water system
      purposes.   Liberty is responsible for $7.45 million of construction
      expenditures, primarily for meter replacements, during the life of the
      contract. Of the total construction expenditures, approximately $2.5
      million is expected to be expended in the next three years.

      EDISON
      Under the contract to operate the water system of the township of
      Edison, New Jersey, Edison  Water Company expects to spend $2.9 million
      during the next three years to upgrade the system.

      ENGINEERING/OPERATIONS/CONSTRUCTION SEGMENT
      AWM
      AWM expects to incur capital expenditures of $2.0 million during the
      next three years,  primarily for vehicles and equipment used in the
      construction and waste hauling operations.

      Capital Resources
      During 1999 the Corporation financed 37.0% of its capital expenditures,
      including capital expenditures for the Regulated Utilities segment and
      investments in the Contract Operations and

                                  -21-
<PAGE>
      Engineering/Operations and Construction segments, from internally
      generated funds (after payment of common stock dividends). The balance
      was financed with a combination of short-term borrowings under lines of
      credit, proceeds from capital contributions from E'town (funded by
      issuances of Common Stock under E'town's Dividend Reinvestment and Stock
      Purchase Plan) and proceeds from the sale of real estate.

      For the three-year period ending December 31, 2002, the Corporation
      estimates that 52% of its currently projected capital expenditures and
      concession fee obligations for all segments are expected to be financed
      with internally generated funds (after payment of common stock
      dividends, at current levels). The balance will be financed with a
      combination of proceeds from the sale of E'town common stock or capital
      contributions from Thames Water after the pending Merger, medium-term
      notes, long-term debt, proceeds of tax-exempt New Jersey Economic
      Development Authority (NJEDA) bonds and short-term borrowings.
      Elizabethtown expects to pursue additional tax-exempt financing to the
      extent that final allocations are granted by the NJEDA.

      In February 2000 E'town issued $30 million of 7.69% Senior Notes due
      2010.  The proceeds were used to repay short-term debt incurred to
      finance the acquisition of the contract to operate the water system of
      the city of Elizabeth and capital expenditures for the non-regulated
      subsidiaries.

      In November 1998 Mount Holly closed on loan agreements that will make
      available up to $13.2 million in proceeds from the issuance of unsecured
      notes through the New Jersey Environmental Infrastructure Trust
      Financing Program. This program provides financing through two loans.
      The first loan, in the amount of $7.3 million, is through the New Jersey
      Environmental Infrastructure Trust (Trust), which issued tax-exempt
      bonds with average interest rates of 4.7%. The second loan, in the
      amount of $5.9 million, is from the State of New Jersey, acting through
      the New Jersey Department of Environmental Protection. The State is
      participating in the Safe Drinking Water State Revolving Fund authorized
      by the Safe Drinking Water Act amendments of 1996 whereby the federal
      government is funding the state loan at no interest cost. The effective
      interest rate for the combined notes is approximately 2.6%. The proceeds
      of the loans  will be used to repay short-term debt incurred to finance
      a portion of the Mansfield Project. The Company expects to request these
      funds from the Trust in the second quarter of 2000.

      E'town' s senior debt is currently rated A3 and A and Elizabethtown's
      senior debt is currently rated A2 and A+ by Moody's Investors Service
      and Standard & Poor's Ratings Group, respectively.


      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS
      INTEREST RATE RISK
      The Corporation is subject to the risk of fluctuating interest rates in
      the normal course of business. The Corporation manages interest rates
      through the use of fixed and, to a lesser extent, variable rate debt. A
      hypothetical single percentage point change in interest rates for the
      three months
      ended March 31, 2000 would result in a $1.1 million change in interest
      costs related to short-term and variable rate debt and to earnings
      before tax.

                                  -22-
<PAGE>
      RESULTS OF OPERATIONS

      Net Income for the three months ended March 31, 2000  was $2.3 million
      or $.26 per basic share as compared with $6.3 million or $0.74 per basic
      share for the same period in 1999.

      Of the $4.0 million or $.48 per basic share decrease, $ 2.1 million or
      $.24 was attributable to an after-tax gain in the 1999 period on the
      sale of a real estate parcel in the Financing and Investment segment in
      1999. Of the remaining $1.9 million decrease, $.9 million or $.12 per
      basic share is largely the result of higher operations expenses in the
      Regulated Utilities segment primarily because Elizabethtown has not
      recovered increases in operations expenses in rate increases, $.5
      million or $.06 per share is related to higher personnel and operating
      costs, reflective of growth in the Engineering/Operations and
      Construction segment and  $.5 million or $.06 per share consists of
      interest costs on additional long-term debt in the Financing and
      Investment segment and increased borrowings in the Contract Operations
      segment.

      Operating Revenues increased $2.7 million or 7.6%  for the three months
      ended March 31, 2000 as compared to the same period in 1999.  Revenues
      from the Engineering/Operations and Construction segment increased by
      $1.8 million to $3.3 million due to AWM's additional revenues from new
      contracts to design and build wastewater  facilities and its acquisition
      in late 1999 of a septic services business (see Economic Outlook -
      Engineering/ Operations and Construction Segment). The Regulated
      Utilities segment accounted for $.8 million of the increase due to new
      industrial  wholesale customers, higher fire service income from
      commercial users and customer growth. The Contract Operations segment
      provided the remaining $.1 million increase in revenues.

      Operation Expenses increased $3.4 million or 23.4% for the three
      months ended March 31, 2000 as compared to the same period
      in 1999. Of the increase, $2.4 million is attributable to
      the Engineering/Operations and Construction segment,
      primarily reflecting additional personnel costs as well as
      other operating costs to support recently acquired business
      (see Operating Revenues above) and future customer growth
      opportunities (see Economic Outlook - Engineering/
      Operations and Construction Segment). The Regulated
      Utilities segment comprised $ .6 million of the increase due
      to labor costs for additional employees, overtime pay caused
      by a harsher 2000 winter and leasing expenditures associated
      with upgrading Elizabethtown's vehicle fleet, partially
      offset by a reduction of purchased water expense at Mount
      Holly from elimination of the PWAC. The Contract Operations
      segment accounted for $.3 million of the increase,
      principally due to purchased water costs. The remaining $.1
      million of the increase in operating expenses is
      attributable to Merger transaction costs incurred by the
      Financing and Investment segment.

      Maintenance Expenses increased $.3 million or 18.2% for the three month
      period ended March 31, 2000 as compared to the comparable period in the
      prior year primarily at the Regulated Utilities segment due to the
      harsher winter weather of 2000. Maintenance costs at the other segments
      remained relatively flat as compared with the same period in the prior
      year.

      Depreciation and Amortization Expense increased $.5 million or 14.0% for
      the three month period in 2000 as compared with the first quarter of
      1999.  Of the increase, $.3 million is due to depreciation on additions
      to utility plant in the Regulated Utilities segment, $.1 million to
      depreciation on nonutility plant in the Contract Operations segment and
      $.1 million to and amortization of goodwill from acquisition of a septic
      services business in 1999 in the Engineering/Operations and Construction
      segment.
      Revenue Taxes increased $.2 million or 5.8% for the first quarter of
      2000 as compared with the first quarter of 1999 due to an overall
      increase in water sales by the Regulated Utilities segment.

      Real Estate, Payroll and Other Taxes Expenses increased $.1 million or
      11.2% for the three months ended March 31, 2000 as compared with the
      first quarter of 1999 due to increased payroll taxes on higher labor
      costs.

      Federal Income Taxes as a component of operating expenses decreased $1.1
      million or 47.6% for the three month periods ended March 31, 2000
      compared to 1999 due to changes in taxable operating income for each
      segment.

                                  -23-
<PAGE>
      Other Income (Expense) decreased $2.0 million or 87.5% for the first
      quarter of 2000 as compared with the first quarter of 1999 due
      principally to the sale of a  parcel of land in Green Brook, New Jersey
      in 1999 at a gain of $3.2 million ($2.1 million after taxes) in the
      Financing and Investment segment.

      Total Interest Charges increased $1.2 million or 27.1% for the three
      months ended March 31, 2000. The increase is comprised of (i) $.8
      million in the Regulated Utilities segment for interest expense incurred
      on a higher level of short-term bank notes used to fund Elizabethtown's
      and Mount Holly's capital expenditures and a higher interest rate on
      Elizabethtown's long-term variable rate debt  (ii) $.3 million in the
      Financing and Investment segment for interest costs on new private
      placement Senior Notes issued in February 2000 and (iii) $.1 million in
      the Contract Operations segment to finance Liberty's scheduled
      concession payment in June 1999 to the city of Elizabeth.

      ECONOMIC OUTLOOK
      Forward Looking Information
      Information in this report includes certain forward looking statements
      within the meaning of the Federal securities laws regarding future
      earnings, capital expenditures and anticipated actions of regulators,
      among other things.  Any forward looking statements are based upon
      information currently available and are subject to future events, risks
      and uncertainties that could cause actual results to differ materially
      from those expressed in the statements. Such events, risks and
      uncertainties include, without limitation, actions of regulators, the
      effects of weather, changes in historical patterns of water consumption
      and demand, including changes through increased use of water-conserving
      devices, conditions in capital and real estate markets, increases in
      operating expenses due to factors beyond the Corporation's control, the
      closing of the pending Merger with Thames Water, changes in
      environmental regulation and associated costs of compliance and
      additional investments or acquisitions which may be made by the
      Corporation.

      E'town Corporation and Subsidiaries
      Earnings are expected to be lower in 2000 than in 1999 for the following
      reasons:

      Regulated Utilities Segment - Water consumption is assumed to return to
      normal levels following a warm, dry summer in 1999.  In addition,
      Elizabethtown has agreed to delay the filing of a base rate case,
      originally planned for early 2000 until at least August 2000 as a
      condition of the Merger Agreement. A rate case is expected to be filed
      early in 2001. As a result, recovery of increases in operating costs and
      costs associated with additional utility plant investments since rates
      were last increased in 1996 will be delayed.

      Engineering/Operations and Construction Segment - Despite substantial
      revenue gains for the first quarter of 2000 over the same period in
      1999, increased costs, primarily related to additional personnel
      incurred to support growth of this segment, led to a loss for the first
      quarter of 2000. A loss is also currently expected for the year 2000.
      Management is reviewing its plans and financial projections for the
      remainder of the year to achieve improved financial results as the
      company grows.

      Financing and Investment Segment - Properties' $2.1 million contribution
      to net income during the first quarter of 1999 was due to a land sale
      that will not recur. Gains are expected on land sales for Properties
      remaining two parcels. The sales are not expected to close before 2001.
      In addition, E'town will incur expenses associated with the pending
      Merger.

      During the next several years, management will further seek to increase
      earnings by (i) maximizing earned returns on the Regulated Utilities
      segment through expansion efforts to increase sales, cost control
      measures and obtaining timely and adequate rate relief and (ii)
      investing in water and wastewater assets (including municipal
      privatization contracts, as well as designing, constructing, operating
      and purchasing wastewater assets through AWM and AWWM, discussed below).

                                  -24-
<PAGE>
      Regulated Utilities Segment
      Elizabethtown, Mount Holly and AWWM
      Elizabethtown expects lower net income in 2000 because (i) water
      consumption is assumed to return to normal levels following a warm, dry
      summer in 1999 and (ii) higher costs associated with operations and
      capital investments incurred since rates were last established in 1996
      which are not presently recovered in rates. Both factors will be
      partially offset by continued growth in Elizabethtown's customer base.
      Furthermore, a rate case originally planned to be filed early in 2000,
      but delayed to at least August 2000 due to the Merger Agreement, is
      planned to be filed early in 2001.

      Management has assumed lower earnings in 2000 than in 1999 based on a
      return to normal usage patterns (based on a 5-year average). Water sales
      during 1999 exceeded normal levels (based on 5-year average per customer
      consumption) by an estimated $2.7 million due to a drought during  July
      and taking into effect state-imposed restrictions on water use during
      August.

      Elizabethtown, which received its last rate increase in 1996, expects
      lower net income in 2000 and 2001 pending the completion of the rate
      case originally planned for early in 2000, but delayed due to the Merger
      Agreement. Upon completion of the rate case planned for early in 2001,
      Elizabethtown expects its earned returns on common equity to increase
      from 9.4% (for the twelve months ended March 31, 2000) to levels
      comparable to authorized rates of return. Recent returns authorized by
      the New Jersey Board of Public Utilities are higher than that currently
      being earned by Elizabethtown. As part of that rate case, Elizabethtown
      will request rate recognition for approximately $90 million in
      additional investments in utility plant since rates were last adjusted
      in 1996, as well as for increases in expenses since that time.

      Elizabethtown is experiencing growth in all customer classes. Total
      customers increased by more than 2,000 in 1999. While sales to wholesale
      customers for the first quarter of 2000 are similar to last year, in
      March 2000 Elizabethtown increased its deliveries to a long-standing
      wholesale customer by 2 million gallons per day (annualized revenue
      impact of $1.1 million). Sales to fire service and industrial customers
      also increased for the quarter.

      Mount Holly had a negative rate of return on common equity of 2.6% in
      1999, compared to an authorized rate of return of 11.25%, established in
      its 1996 base rate case. Mount Holly earned significantly below its
      authorized return in 1999 and 1998 because the Company was precluded
      from filing for needed rate relief due to recently settled litigation
      with another purveyor. Management expects Mount Holly to contribute to
      the Corporation's earnings per share in 2000 as a result of a
      Stipulation Agreement approved by the BPU whereby a rate increase of
      $1.9 million, or a net increase of $.5 million after elimination of the
      PWAC, was effective January 1, 2000.

      AWWM expects to become profitable after it expands its customer base in
      the next several years.

      Contract Operations Segment
      Liberty
      Liberty is expected to realize a return on its capital in an amount
      similar to that currently earned by the Corporation's regulated
      operations.

      Edison
      Edison is expected to realize a return on its capital in an amount
      similar to that currently earned by the Corporation's regulated
      operations. Contributions to earnings will be small through 2002 and
      then will increase as rate increases specified in the contract take
      effect.
                                  -25-
<PAGE>
      E'town continues to pursue opportunities to operate municipal water and
      wastewater systems under long-term contracts, primarily in New Jersey.
      E'town will focus on opportunities where it may have an advantage due to
      location or experience in operation.

      Engineering/Operations and Construction Segment
      AWM
      AWM, acquired by E'town in June 1998, provides engineering, construction
      and operations services for stand-alone water and wastewater treatment
      facilities for industrial, commercial and residential customers, as well
      as developers of such properties.

      Despite increases in revenues for the quarter ended March 31, 2000
      versus the comparable period in 1999, AWM incurred a loss for the
      quarter due primarily to higher costs to finance growth. Such costs are
      due to additional personnel to support higher business volumes as well
      as startup and subsequent expansion, of an office in New England. In
      addition, two construction projects anticipated for the first quarter
      were delayed due to permitting issues. Customer demand remains strong
      with several projects in the proposal and/or contract negotiation
      stage.  Management is reviewing its plans and financial projections for
      the remainder of the year to achieve improved financial results as the
      company grows.

      Financing and Investment Segment
      E'town and Properties
      In 1997, E'town decided to sell its unregulated real estate assets
      (Properties) and reinvest the proceeds in water and wastewater projects.
      Several properties were sold during 1997 and 1998 and one property was
      sold in January, 1999 for an after-tax gain of $2.0 million.

      At this time, the two remaining properties are under contract to be sold
      for amounts in excess of current carrying costs. The sale of these
      parcels is contingent upon various municipal approvals and closings are
      expected to occur in stages from 2001 through 2004. After-tax sale
      proceeds are expected to be used to fund investments in water and
      wastewater projects.

      New Accounting Pronouncements
      See Note 3 of the Corporation's Notes to Consolidated Financial
      Statements for a discussion of new accounting standards.

      Year 2000
      State of Readiness
      The Corporation has assessed its significant business systems, as well
      as non-critical, peripheral support systems for compliance with the Year
      2000 computer challenge. The assessment concluded that all significant
      business systems (i.e. customer billing and service, financial, water
      treatment operating and control, water quality laboratory information
      and telemetric data acquisition systems) are Year 2000 compliant. The
      assessment also included inquiries as to the state of readiness of
      significant vendors whose services to the Corporation could have an
      impact on the Corporation's ability to deliver service to its customers.
      Management concluded that the delivery of electric power as well as
      chemicals used in the water treatment process are two areas of
      significant importance and received documentation from the vendors who
      provide these services that indicates their ability to provide service.
      Therefore, the Corporation expects no disruption in the services it
      provides to its customers and expects to process transactions in its
      financial, customer billing and customer services systems. See
      Contingency Plan below for a discussion of alternative sources of
      power.  The assessment had identified certain modifications to
      peripheral support systems that have since been implemented.

                                  -26-
<PAGE>
      The Costs To Address The Corporation's Year 2000 Issues
      The significant business systems of the Corporation defined above are
      Year 2000 compliant and have been operational for up to several years.
      Therefore, no further costs are expected to be incurred in connection
      with bringing these systems into compliance. The peripheral support
      systems required the Corporation to incur costs of approximately $.3
      million in 1999 to bring them into compliance.

      Risks Associated With The Corporation's Year 2000 Issues
      Management believes that all identifiable issues with respect to Year
      2000 compliance have been addressed, or will be addressed, in sufficient
      time and in sufficient detail to preclude any disruption in service or
      adverse effect on the Corporation's financial profile. Management,
      therefore, believes that risks associated with this issue are minimal
      with respect to those areas, which are internal to the Corporation and
      over which management exercises control. Those areas that are external
      to the Corporation i.e. issues associated with our vendors, have been
      mitigated to the extent possible through inquiry of our vendors, tests
      of their claims of Year 2000 compliance and development of contingency
      plans as considered appropriate.

      Contingency Plan
      There are operational contingency plans in place on an ongoing basis to
      address issues, such as natural disasters, that could result in a
      disruption of service. These procedures would be activated in the event
      that certain physical facilities were not operable as a result of
      failures by our vendors associated with Year 2000 issues. In addition,
      Elizabethtown Water Company has alternative electric, natural gas and
      diesel generation capacity that could sustain a significant level of
      pumping capacity for an indefinite period of time.

                                  -27-
<PAGE>
      PART II - OTHER INFORMATION

      Item 1 Legal Proceedings
      On September 23, 1999, two parties filed separate class action lawsuits
      for compensatory damages and related fees on behalf of themselves and
      similarly situated residential and commercial customers against
      Elizabethtown Water Company, Edison Water Company and Liberty Water
      Company. The lawsuit alleges breach of contract, breach of tariff,
      negligence and products liability regarding the quantity and quality of
      water services provided by the Corporation during the period in
      September 1999 when Elizabethtown's Plant was flooded from Floyd and was
      withdrawn from service for approximately 3 days. Elizabethtown has
      notified its insurance carrier of the lawsuit and has filed a motion for
      summary judgment to dismiss the lawsuit as a class action proceeding
      prior to answering the allegations.  In March 2000, the New Jersey
      Superior Court (NJSC) ruled that in the event the lawsuit is not
      dismissed, the case be referred to the BPU for purposes of investigating
      the matter and reporting its findings to the NJSC. The NJSC, in view of
      the BPU's findings, will then determine what, if any, damages were
      suffered by the plaintiffs and what liability rests with Elizabethtown.
      Although the insurance carrier does not provide coverage for breach of
      contract and limits its liability coverage for breach of tariff, the
      Corporation maintains that plaintiffs' allegations are without merit and
      believes that the plaintiffs' chances of prevailing are not probable and
      that those allegations specifically not covered by insurance pose
      immaterial liability.

      Items 2 - 5:

           Nothing to Report.

      Item 6(a) - Exhibits

      Exhibits to Part I:


      Exhibit 4     -   E'town Corporation - Note Purchase Agreement
                        relating to 7.69% Senior Notes due February 1, 2010

      Exhibit 12    -   E'town Corporation and Subsidiaries - Computation of
                        Ratio of Earnings to Fixed Charges

      Exhibit 12(a) -   Elizabethtown Water Company - Computation of Ratio of
                        Earnings to Fixed Charges

      Exhibit 12(b) -   Elizabethtown Water Company - Computation of Ratio of
                        Earnings to Fixed Charges and Preferred Dividends

      Exhibit 27    -   E'town Corporation and Subsidiaries and Elizabethtown
                        Water Company and Subsidiary - Financial Data Schedules

      Item 6(b)     -   Reports on Form 8-K

                     None

                                  -28-
<PAGE>

                              E'TOWN CORPORATION
                          ELIZABETHTOWN WATER COMPANY


                                  SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


Date : May 12, 2000



                               E'TOWN CORPORATION
                               ELIZABETHTOWN WATER COMPANY




                               /s/ Gail P. Brady
                               ____________________________________
                               Gail P. Brady
                               Treasurer



                               /s/ Dennis W. Doll
                               _____________________________________
                               Dennis W. Doll
                               Controller





                                  -29-