MIDDLESEX WATER CO (MSEX)·Q3 2025 Earnings Summary

Executive Summary

• Q3 results showed solid sequential recovery but slight year-over-year softness: revenue $54.09M (-1.8% y/y; +9.7% q/q), diluted EPS $0.77 (-3.8% y/y; +28% q/q) as lower weather-driven consumption reduced top line y/y while opex fell on lower legal/regulatory costs and higher capitalizable costs .
• Below S&P Global consensus on both EPS and revenue for Q3 2025, setting up near-term estimate recalibration given weather and production-cost dynamics*.
• Regulatory/cash return catalysts: DE base-rate increase implemented in July (+$5.5M annual revenue; ROE 9.5%); NJ base-rate case filed for +$24.9M with DSIC/RESIC program frameworks in place; dividend raised 5.88% to $0.36 (annualized $1.44) .
• Strategy execution continues: $72M capex YTD (77% of $93M plan), fourth DSIC filed (incremental ~$0.9M annual revenue expected), and signed APA to acquire Pinewood Acres in DE (~350 customers) .

What Went Well and What Went Wrong

What Went Well

• Sequential improvement: Revenue rose to $54.09M (+$4.77M q/q) and diluted EPS to $0.77 (+$0.17 q/q), aided by lower opex (lower legal/financial/regulatory costs and more capitalizable costs) .
• Regulatory momentum: DE base-rate settlement approved (effective July 3) for +$5.5M annual revenue, 9.5% ROE and 53.5% equity ratio, supporting returns and reinvestment .
• Shareholder returns reinforced: Quarterly dividend increased 5.88% to $0.36, marking 53 consecutive years of annual dividend increases (annualized $1.44) .

Management quote: “This acquisition aligns with our MWC2030 strategy to bring our high standards of operational excellence, safety, and water quality to a broader customer base.” — Nadine Leslie, Chair, President & CEO, on Pinewood Acres APA .

What Went Wrong

• Weather-driven volume headwinds: Operating revenues declined y/y to $54.09M (-$1.0M) on lower consumption from unfavorable weather, partly offset by rate increases and customer growth .
• Cost pressures in production and depreciation: Higher variable production costs from weather-driven lower water quality and higher depreciation partially offset opex benefits .
• Modest y/y profit slippage: Net income $13.96M and diluted EPS $0.77 were down vs. $14.32M and $0.80 in Q3 2024 as consumption softness outweighed pricing and customer growth .

Financial Results

Income Statement Highlights (USD Millions, except per-share)

Notes:

• YoY: Revenue -1.8%, EPS -3.8% driven by lower weather-related consumption; partial offsets from rate increases/customer growth .
• QoQ: Revenue +9.7%, EPS +28% on seasonal recovery and lower opex from reduced legal/regulatory costs and higher capitalizable costs .

Profitability Margins (percent of revenue)

KPIs and Regulatory/Capital Program

Segment breakdown: Not disclosed in the Q3 2025 press release .

Guidance Changes

Earnings Call Themes & Trends

(Company did not provide a Q3 2025 call transcript in the documents reviewed; themes reflect quarterly disclosures and prior quarter commentary.)

Management Commentary

• “We continue to focus on our selective and sustainable growth pillar, and we are pleased to announce the execution of an asset purchase agreement to acquire the water utility asset of Pinewoods Acres in Delaware… This acquisition aligns with our MWC2030 strategy…” — Nadine Leslie, Chair, President & CEO .
• “The constructive outcome of the general rate case in Delaware supports our selective and sustainable growth pillar and the ability to continue making prudent investments in our Tidewater System…” — Nadine Leslie, Q2 release .
• “We are excited to welcome Ocean View residents as our customers… demonstrating our focus on selective and sustainable growth…” — Nadine Leslie, Q1 release .

Q&A Highlights

• No Q3 2025 earnings call transcript was available in company filings/press releases reviewed; management color above reflects disclosures from the earnings press release and recent quarterly communications .

Estimates Context

Values marked with * retrieved from S&P Global.

Implications: Both EPS and revenue were below consensus*, suggesting models may need to further reflect weather-driven volume variability and the expense mix highlighted by management .

Key Takeaways for Investors

• Sequential rebound with Q3 operating and net margins returning near prior-year levels as opex eased, though y/y revenue and EPS were modestly lower on weather-driven consumption headwinds .
• Regulatory underpinnings strengthened: DE rate case in effect since July (+$5.5M annual revenue; 9.5% ROE), with NJ base-rate filing and DSIC/RESIC mechanisms creating visibility into recovery of ongoing capex .
• Capital deployment on track: $72M invested YTD (77% of the $93M plan), supporting asset base growth and depreciation trajectory .
• Cash return upgraded: Dividend lifted 5.88% to $0.36 (annualized $1.44), reinforcing confidence in cash flow durability .
• Selective M&A remains a growth lever: Ocean View closed in Q1; Pinewood Acres APA in Q3 expands the DE footprint and customer base .
• Near-term catalysts: NJ BPU decision on base-rate case/DSIC-RESIC filings, closing/approval of Pinewood Acres acquisition, and ongoing quarterly DSIC contributions .
• Estimates watch: Q3 misses vs S&P Global consensus* may prompt modest near-term estimate resets; monitor management updates on consumption trends and production cost normalization heading into seasonally weaker quarters .

Appendix: Source Documents

• Q3 2025 8-K/Press Release: revenues, EPS, drivers, opex, capex, DSIC, Pinewood Acres APA
• Q2 2025 8-K/Press Release: revenues, EPS, DE rate case approval, NJ filings
• Q1 2025 Press Release: revenues, EPS, Ocean View acquisition
• Dividend Increase Press Release (Oct 24, 2025): $0.36 dividend, 53rd consecutive year