Middlesex Water Company Reports Revenue Growth and Acquisition in Q1 2025

Middlesex Water Company reported a notable increase in its financial performance for the first quarter of 2025, with operating revenues reaching $44.3 million, up from $40.5 million in the same period of 2024. This 6.9% increase was primarily driven by higher revenues from the Middlesex System, which saw a $3.4 million rise due to a base rate increase effective March 1, 2024, as well as increased demand from general meter service and wholesale customers. However, net income for the quarter decreased to $9.5 million, compared to $10.7 million in the prior year, reflecting a decline in other income and increased operating expenses.

Operating expenses also rose, totaling $32.7 million for the quarter, compared to $30.7 million in the previous year. The increase was attributed to higher operations and maintenance costs, which rose by $0.6 million due to increased variable production costs and weather-related main break activities. Depreciation expenses increased significantly by $1.1 million, reflecting a higher average utility plant in service. Despite these challenges, operating income improved to $11.6 million from $9.9 million a year earlier, indicating effective management of core operations.

In terms of strategic developments, Middlesex Water Company completed the acquisition of the water utility assets of the Town of Ocean View, Delaware, for approximately $4.6 million in April 2025. This acquisition is expected to enhance the company's service capabilities, as Ocean View serves around 900 customers. Additionally, the company has been proactive in addressing regulatory changes, particularly with the new PFAS regulations set by the USEPA, and has begun implementing strategies to meet these standards.

Operationally, Middlesex Water Company serves approximately 61,000 retail customers in New Jersey and 62,000 in Delaware, with ongoing customer growth in its Tidewater system reported at about 3.5% in 2024. The company is also focused on expanding its infrastructure, with plans to invest approximately $93 million in 2025 for various projects, including the replacement of aging water mains and the construction of new elevated water tanks. The company’s total assets increased to $1.28 billion as of March 31, 2025, up from $1.26 billion at the end of 2024, reflecting ongoing investments in utility infrastructure.

Looking ahead, Middlesex Water Company anticipates that its ability to increase operating and net income will depend on several factors, including weather conditions, timely rate relief, effective cost management, and customer growth. The company is preparing for potential base rate increase requests in mid-2025 to address rising operating costs and capital expenditures. Overall, while the company faces challenges, it remains committed to enhancing service quality and expanding its operational footprint through strategic investments and acquisitions.