What changed in this filing

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Item 1. Financial Statements

2025-08-08 compared with 2025-05-09 · 238 added, 133 removed, 588 unchanged (39% of the section changed)

3 unchanged sentences

(In thousands)

March 31, 2025

December 31, 2024

ASSETS June 30, 2025 December 31, 2024

Utility plant, at original cost (less accumulated depreciation - 2025 - $ 198,012 ;

13 unchanged sentences

Other deferred assets 6,986 6,525

Goodwill 1,939 1,939

Operating lease right-of-use assets 410 414

1 unchanged sentence

Regulatory assets, net 13,593 14,428

Total Assets $ 819,296 $ 798,623

LIABILITIES AND STOCKHOLDERS' EQUITY

Stockholders' equity

Common stock $ 10,311 $ 10,300

Preferred stock - -

3 unchanged sentences

Long-term debt, net of current portion 175,138 176,509

420,043 415,698

Current liabilities

7 unchanged sentences

Customer and other deposits 3,387 3,347

Other 2,190 2,054

Total current liabilities 25,569 25,593

13 unchanged sentences

(In thousands, except per share amounts)

For the Three Months Ended March 31,

For the Three Months Ended For the Six Months Ended

June 30, June 30,

2025 2024 2025 2024

Operating revenues

Water sales $ 23,083 $ 22,501 $ 43,771 $ 42,326

Other utility operating revenue 3,639 3,288 6,997 6,303

9 unchanged sentences

Operating income 7,855 7,198 13,400 11,917

Other income, net

Allowance for funds used during construction (AFUDC) 619 367 1,186 653

Miscellaneous income

Miscellaneous (expense) income ( 29 ) ( 65 ) 1,459 1,508

Income before interest charges 8,445 7,500 16,045 14,078

1 unchanged sentence

Net income applicable to common stock $ 6,290 $ 5,325 $ 11,725 $ 9,736

Net income per common share:

Income per common share:

Basic $ 0.61 $ 0.52 $ 1.14 $ 0.95

Diluted $ 0.61 $ 0.52 $ 1.14 $ 0.95

Weighted average common shares outstanding:

Basic 10,308 10,293 10,305 10,290

Diluted 10,310 10,295 10,308 10,293

Cash dividends per share of common stock $ 0.3074 $ 0.2955 $ 0.6088 $ 0.5852

3 unchanged sentences

(In thousands)

For the Three Months

Ended March 31,

For the Six Months Ended

CASH FLOWS FROM OPERATING ACTIVITIES

Net income $ 11,725 $ 9,736

Adjustments to reconcile net income to net cash provided by operating activities:

40 unchanged sentences

(In thousands)

For the Three Months

Ended March 31,

NET INCREASE IN CASH AND CASH EQUIVALENTS

For the Six Months Ended

NET (DECREASE)INCREASE IN CASH AND CASH EQUIVALENTS $ ( 798 ) $ 3,746

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 1,147 2,505

1 unchanged sentence

Supplemental Disclosures of Cash Flow Information:

For the Three Months

Ended March 31,

For the Six Months Ended

Non-cash Investing and Financing Activity:

1 unchanged sentence

Change in amounts included in accounts payable, accrued payables and other related to capital expenditures $ ( 2,335 ) $ 1,008

Supplemental Disclosures of Cash Flow Information:

Interest paid $ 4,181 $ 4,193

5 unchanged sentences

(In thousands)

Common Shares Outstanding Class A Non-Voting (1) (3) (4)

Common Shares Outstanding Class B Voting (2)

$ 1 Par Value Class A Non-Voting

$ 1 Par Value Class B Voting

Additional Paid-in Capital

Retained Earnings

Common Shares Outstanding Class A Non-Voting (1) (3) (4) Common Shares Outstanding Class B Voting (2) $ 1 Par Value Class A Non-Voting $ 1 Par Value Class B Voting Additional Paid-in Capital Retained Earnings Total

Balance as of December 31, 2023 9,404 881 $ 9,404 $ 881 $ 143,369 $ 76,743 $ 230,397

Net income - - - - - 4,411 4,411

Cash dividends declared

Common stock - - - - - ( 2,980 ) ( 2,980 )

Issuance of common stock

3 unchanged sentences

Balance as of March 31, 2024 9,407 881 $ 9,407 $ 881 $ 143,524 $ 78,174 $ 231,986

Common Shares Outstanding Class A Non-Voting (1) (3) (4)

Common Shares Outstanding Class B Voting (2)

$ 1 Par Value Class A Non-Voting

$ 1 Par Value Class B Voting

Additional Paid-in Capital

Retained Earnings

Net income - - - - - 5,325 5,325

Cash dividends declared -

Common stock - - - - - ( 3,042 ) ( 3,042 )

Issuance of common stock

Dividend reinvestment plan 3 - 3 - 87 - -

Employee stock options and awards(4) 5 - 5 - 52 - 57

Employee Retirement Plan(3) - - - - - - -

Balance as of June 30, 2024 9,415 881 $ 9,415 $ 881 $ 143,663 $ 80,457 $ 234,326

Common Shares Outstanding Class A Non-Voting (1) (3) (4) Common Shares Outstanding Class B Voting (2) $1 Par Value Class A Non-Voting $1 Par Value Class B Voting Additional Paid-in Capital Retained Earnings Total

Balance as of December 31, 2024 9,419 881 $ 9,419 $ 881 $ 143,920 $ 84,969 $ 239,189

Net income - - - - - 5,435 5,435

Cash dividends declared -

Common stock - - - - - ( 3,104 ) ( 3,104 )

Issuance of common stock

3 unchanged sentences

Balance as of March 31, 2025 9,422 881 $ 9,422 $ 881 $ 144,047 $ 87,300 $ 241,650

At March 31, 2025 , and March 31, 2024 , Class A Stock had 15,000,000 shares authorized.

Net income - - - - - 6,290 6,290

Cash dividends declared - -

Common stock - - - - - ( 3,169 ) ( 3,169 )

Issuance of common stock

Dividend reinvestment plan 3 - 3 - 84 - 87

Employee stock options and awards(4) 5 - 5 - 42 - 47

Employee Retirement Plan(3) - - - - - - -

Balance as of June 30, 2025 9,430 881 $ 9,430 $ 881 $ 144,173 $ 90,421 $ 244,905

At June 30, 2025 and June 30, 2024, Class A Stock had 15,000,000 shares authorized.

For the same periods, shares issued, inclusive of treasury shares, were 9,458,054 and 9,443,071 , respectively.

At March 31, 2025 , and March 31, 2024 , Class B Stock had 1,040,000 shares authorized and 881,452 shares issued.

At June 30, 2025 and June 30, 2024, Class B Stock had 1,040,000 shares authorized and 881,452 shares issued.

Artesian Resources Corporation registered 200,000 shares of Class A Stock, subsequently adjusted for stock splits, available for purchase through the Company’s 401(k) retirement plan.

Under the Equity Compensation Plan, effective December 9, 2015, or the 2015 Plan, Artesian Resources Corporation authorized up to 331,500 shares of Class A Stock for issuance of grants in the form of stock options, stock units, dividend equivalents and other stock-based awards, subject to adjustment in certain circumstances as discussed in the 2015 Plan.

Includes stock compensation expense for March 31, 2025 and March 31, 2024 , See Note 8 - Stock Compensation Plans.

Includes stock compensation expense for June 30, 2025 and June 30, 2024.

See Note 8 – Stock Compensation Plans.

See notes to the condensed consolidated financial statements.

19 unchanged sentences

They are Artesian Utility Development, Inc., or Artesian Utility, and Artesian Development Corporation, or Artesian Development.

Artesian Utility designs and builds water and wastewater infrastructure and provides contract water and wastewater operation services on the Delmarva Peninsula to private, municipal and governmental institutions.

Artesian Utility also evaluates land parcels, provides recommendations to developers on the size of water or wastewater facilities and the type of technology that should be used for treatment at such facilities, and operates water and wastewater facilities in Delaware for municipal and governmental agencies.

Artesian Utility also contracts with developers and government agencies for design and construction of wastewater infrastructure throughout the Delmarva Peninsula.

Artesian Utility designs

and builds water and wastewater infrastructure and provides contract water and

wastewater operation services on the Delmarva Peninsula to private, municipal

and governmental institutions.

Utility may also evaluate land parcels and provide recommendations to

developers on the size of water or wastewater facilities and the type of

technology that should be used for treatment at such facilities.

Artesian Utility also contracts with

developers and government agencies for design and construction of wastewater

infrastructure throughout the Delmarva Peninsula.

Artesian Utility currently operates wastewater treatment facilities for the Town of Middletown, in southern New Castle County, Delaware, or Middletown, under a 20 -year contract that expires in July 2039.

13 unchanged sentences

The condensed consolidated financial statements include the accounts of Artesian Resources Corporation and its wholly-owned subsidiaries, including its principal operating company, Artesian Water.

In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments (unless otherwise noted) necessary to present fairly the Company’s balance sheet position as of March 31, 2025 , the results of its operations for the three -month periods ended March 31, 2025 and March 31, 2024 , its cash flows for the three -month periods ended March 31, 2025 and March 31, 2024 and the changes in stockholders’ equity for the three -month periods ended March 31, 2025 and March 31, 2024 .

In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments (unless otherwise noted) necessary to present fairly the Company's balance sheet position as of June 30, 2025, the results of its operations for the three and six-month periods ended June 30, 2025 and June 30, 2024, its cash flows for the six-month periods ended June 30, 2025 and June 30, 2024 and the changes in stockholders’ equity for the three and six-month periods ended June 30, 2025 and June 30, 2024.

The December 31, 2024 Condensed Consolidated Balance Sheet was derived from the Company’s December 31, 2024 audited consolidated financial statements but does not include all disclosures and notes normally provided in annual financial statements.

The results of operations for the interim periods presented are not necessarily indicative of the results for the full year or for future periods.

Reclassification

Certain accounts in the prior year financial statements have been reclassified for comparative purposes to conform with the presentation in the current year financial statements.

These reclassifications had no effect on net income or stockholders' equity.

Regulated Utility Accounting

14 unchanged sentences

For financial reporting purposes, depreciation is recorded using the straight-line method at rates based on estimated economic useful lives, which range from 5 to 85 years.

Composite depreciation rates for water utility plant were 1.93 % and 1.93 % for March 31, 2025 and December 31, 2024, respectively.

Composite depreciation rates for water utility plant were 1.93 %, and 1.93 % for June 30, 2025 and December 31, 2024, respectively.

In a rate order issued by the DEPSC, the Company was directed, effective June 12, 2024, to begin using revised depreciation rates for utility plant in Artesian Water, which are based on the estimated useful life years.

49 unchanged sentences

Until final rates are determined by the DEPSC, if it is probable that a refund of revenue associated with temporary rates will occur, a reserve would be recorded reducing revenue from temporary rates.

Temporary rates that were previously effective as of November 28, 2023 were replaced with final rates effective June 12, 2024, with no reserve or reduction to previously recorded revenue, as approved by the DEPSC.

As of June 30, 2025 and June

30, 2024, no such reserve or reduction to revenue was recorded.

Temporary rates that were previously

effective as of November 28, 2023 were replaced with final rates effective June

12, 2024, with no reserve or reduction to previously recorded revenue, as

approved by the DEPSC.

approved and Artesian Water implemented a temporary rate increase effective

June 3, 2025.

Accounts receivable related to tariff contract revenues are typically due within 25 days of invoicing.

20 unchanged sentences

These services are invoiced at the end of every month based on incurred costs to date.

As of March 31, 2025, there is no associated contract asset or liability.

As of June 30, 2025, there is no associated contract asset or liability.

There is no provision for expected credit loss or bad debt expense associated with this revenue.

10 unchanged sentences

all revenues are generated within a similar geographical location:

For the Three Months For the Six Months

Ended June 30, Ended June 30,

(in thousands) 2025 2024 2025 2024

Three months ended March 31, 2025

Three months ended March 31, 2024

Tariff Revenue

Consumption charges $ 15,454 $ 15,176 $ 28,476 $ 27,486

Fixed fees 9,335 9,102 18,600 18,422

Service charges 178 178 359 380

DSIC 235 - 534 -

Metered wastewater services 213 205 400 344

11 unchanged sentences

Our contract assets and liabilities consist of the following:

(in thousands)

March 31, 2025

December 31, 2024

(in thousands) June 30, 2025 December 31, 2024

Contract Assets – Tariff $ 3,892 $ 3,030

3 unchanged sentences

Total Deferred Revenue $ 2,227 $ 2,099

For the three months ended March 31, 2025, the Company recognized revenue of $ 1.4 million from amounts that were included in Deferred Revenue – Tariff at the beginning of the year and revenue of $ 0.4 million from amounts that were included in Deferred Revenue – Non- Tariff at the beginning of the year.

For the six months ended June 30, 2025, the Company recognized revenue of $ 1.4 million from amounts that were included in Deferred Revenue – Tariff at the beginning of the year and revenue of $ 0.5 million from amounts that were included in Deferred Revenue – Non-Tariff at the beginning of the year.

The changes in Contract Assets and Deferred Revenue are primarily due to normal timing differences between our performance and customer payments.

Remaining Performance Obligations

As of March 31, 2025 and December 31, 2024, Deferred Revenue – Tariff is recorded net of contract assets within Unbilled operating revenues and represents our remaining performance obligations for our fixed fee water and wastewater services, all of which are expected to be satisfied and associated revenue recognized in the next three months .

As of March 31, 2025 and December 31, 2024, Deferred Revenue – Non-Tariff is recorded within Other current liabilities and represents our remaining performance obligations for our SLP Plan services, contract water operation services and wastewater inspections, which are expected to be satisfied and associated revenue recognized within the next three months , approximately four years and one year , respectively.

As of June 30, 2025 and December 31, 2024, Deferred Revenue – Tariff is recorded net of contract assets within Unbilled operating revenues and represents our remaining performance obligations for our fixed fee water and wastewater services, all of which are expected to be satisfied and associated revenue recognized in the next three months .

As of June 30, 2025 and December 31, 2024, Deferred Revenue – Non-Tariff is recorded within Other current liabilities and represents our remaining performance obligations for our SLP Plan services, contract water operation services and wastewater inspections, which are expected to be satisfied and associated revenue recognized within the next three months , approximately four years and one year , respectively.

NOTE 4 – ACCOUNTS RECEIVABLE

Accounts receivable are recorded at the invoiced amounts.

As set forth in a settlement agreement, Artesian Water will receive reimbursements from the Delaware Sand and Gravel Remedial Trust, or Trust, for Artesian Water’s past capital and operating costs, totaling approximately $ 10.0 million, related to the treatment costs associated with the release of contaminants from the Delaware Sand & Gravel Landfill Superfund Site, or Site, in groundwater that Artesian Water uses for public potable water supply.

Three installments for approximately $ 2.5 million each were paid in August 2022, July 2023 and July 2024.

The final $ 2.5 million installment payment is due no later than July 2025.

In addition, the Trust shall reimburse Artesian Water for documented reasonable and necessary capital and operating costs after July 1, 2021 that Artesian Water incurs to treat contaminants of concern and of emerging concern.

As set forth in a settlement agreement, Artesian Water received reimbursements from the Delaware Sand and Gravel Remedial Trust, or Trust, for Artesian Water’s past capital and operating costs, totaling approximately $ 10.0 million, related to the treatment costs associated with the release of contaminants from the Delaware Sand & Gravel Landfill Superfund Site, or Site, in groundwater that Artesian Water uses for public potable water supply.

The full amount of $ 10.0

million has been paid to us, in four installments of approximately $ 2.5 million each,

in August 2022, July 2023, July 2024 and July 2025.

In addition, from July 1, 2021 onward the

Trust shall reimburse Artesian Water for documented reasonable and necessary

capital and operating costs that Artesian Water incurs to treat contaminants of

concern and of emerging concern.

A provision for expected credit loss is calculated as a percentage of total associated revenues based upon historical trends and adjusted for current and reasonable projections based upon expected economic conditions.

2 unchanged sentences

The following table summarizes the changes in the Company’s accounts receivable balance:

(in thousands)

(in thousands) June 30, 2025 December 31, 2024 December 31, 2023

Customer accounts receivable – water $ 7,517 $ 6,824 $ 6,573

4 unchanged sentences

Miscellaneous accounts receivable 114 100 471

11,398 11,682 13,158

provision for expected credit loss 396 343 328

14 unchanged sentences

Rent expense for all operating leases, except those with terms of 12 months or less, comprises:

For the Three Months Ended June 30, For the Six Months Ended June 30,

(in thousands) 2025 2024 2025 2024

Three Months Ended

March 31, 2025

March 31, 2024

Minimum rentals $ 2 $ 4 $ 4 $ 8

Contingent rentals - - - -

Rent expenses $ 2 $ 4 $ 4 $ 8

Supplemental cash flow information related to leases is as follows:

(in thousands)

Three Months Ended

March 31, 2025

March 31, 2024

Six months ended Six months ended

June 30, 2025 June 30, 2024

Cash paid for amounts included in the measurement of lease liabilities:

3 unchanged sentences

Supplemental balance sheet information related to leases is as follows:

(in thousands,

except lease term and discount rate)

March 31, 2025

December 31, 2024

(in thousands, except lease term and discount rate)

June 30, 2025 December 31, 2024

Operating Leases:

4 unchanged sentences

Weighted Average Remaining Lease Term

Operating leases

Operating leases 68 years 68 years

Weighted Average Discount Rate

Operating leases 5.0 % 5.0 %

Maturities of operating lease liabilities that have initial or remaining non-cancelable lease terms in excess of one year as of March 31, 2025 are as follows:

Maturities of operating lease liabilities that have initial or remaining non-cancelable lease terms in excess of one year as of June 30, 2025 are as follows:

(in thousands)

Operating Leases

Thereafter 1,319

Total undiscounted lease payments $ 1,442

1 unchanged sentence

Total lease liabilities recognized $ 409

As of March 31, 2025, we have not entered into operating or finance leases that will commence at a future date.

N OTE 6 – FAIR VALUE OF FINANC IAL INSTRUMENTS

As of June 30, 2025, we have not entered into operating or finance leases that will commence at a future date.

NOTE 6 – FAIR VALUE OF FINANCIAL INSTRUMENTS

The following methods and assumptions were used to estimate the fair value of each class of financial instrument for which it is practicable to estimate that value.

3 unchanged sentences

Long-term Financial Liabilities

As of March 31, 2025 and December 31, 2024, all of the Company’s outstanding long-term debt interest rates were a fixed rate.

As of June 30, 2025 and December 31, 2024, all of the Company’s outstanding long-term debt interest rates were a fixed rate.

The fair value of the Company’s long-term debt is determined by discounting their future cash flows using current market interest rates on similar instruments with comparable maturities consistent with ASC 825, Financial Instruments.

4 unchanged sentences

(in thousands)

March 31, 2025

December 31, 2024

June 30, 2025 December 31, 2024

Carrying amount $ 177,351 $ 178,676

14 unchanged sentences

For the full year 2024, the Company accrued approximately $ 17 thousand in penalties and interest related to positions taken on the 2022 corporate income tax return.

For the three months ended March 31, 2025, the Company has accrued approximately $ 4 thousand in penalties and interest related to positions taken on the 2022 corporate income tax return.

For the six months ended June 30, 2025, the Company has accrued approximately $ 10 thousand in penalties and interest related to positions taken on the 2022 corporate income tax return.

The Company remains subject to examination by federal and state authorities for the tax years 2021 through 2024 .

Investment tax credits were deferred through 1986 and are recognized as a reduction of deferred income tax expense over the estimated economic useful lives of the related assets.

2025, the One Big Beautiful Bill Act, or OBBBA, was signed into law, which

includes several changes to U.S.

tax and related laws, including the temporary

and permanent extension of expiring provisions of the Tax Cuts and Jobs Act of

The Company is currently

evaluating the impact that the OBBBA may have on its consolidated financial

condition and results of operations but anticipates minimal impact.

NOTE 8 – STOCK COMPENSATION PLANS

4 unchanged sentences

The Committee has the authority to determine the individuals to whom grants will be made under the 2015 Plan, determine the type, size and terms of the grants, determine the time when grants will be made and the duration of any applicable exercise or restriction period (subject to the limitations of the 2015 Plan) and deal with any other matters arising under the 2015 Plan.

The Committee presently consists of three directors, each of whom is a non-employee director of the Company.

All of the employees of the Company and its subsidiaries are eligible for grants under the 2015 Plan.

Non-employee directors of the Company are also eligible to receive grants under the 2015 Plan.

On May 6, 2024, 5,000 shares of Class A Non-Voting Common Stock, or Class A Stock, were granted as restricted stock awards.

The fair value per share was $ 37.07 , the closing price of the Class A Stock as recorded on the Nasdaq Global Select Market on May 6, 2024.

These restricted stock awards will be fully vested and released one year after the grant date and, prior to their vesting date, are subject to forfeiture in the event of the recipient’s termination of service.

Compensation expense of approximately $ 46 thousand, related to the May 2024 issue of restricted stock awards, was recorded for three months ended March 31, 2025.

Compensation expense of approximately $ 68 thousand was recorded for three months ended March 31, 2024 for restricted stock awards issued in May 2023.

All of the employees of the Company

and its subsidiaries are eligible for grants under the 2015

Non-employee directors of the Company are also eligible to receive

grants under the 2015 Plan.

On April 11, 2025, 1,000

shares of Class A Stock were granted as a restricted

The fair value per share

was $ 33.51 , the closing price of the Class A Stock as recorded on the Nasdaq

Global Select Market on April 11, 2025.

This restricted stock award will be fully

vested and released one year after the grant date and, prior to its vesting

date, is subject to forfeiture in the event of the recipient’s termination of

On May 5, 2025, 4,000 shares

of Class A Stock were granted as

restricted stock awards.

The fair value

per share was $ 34.27 , the closing price of the Class A Stock as recorded on the

Nasdaq Global Select Market on May 5, 2025.

These restricted stock awards will be fully

vested and released one year after the grant date and, prior to their vesting

date, are subject to forfeiture in the event of the recipient’s termination of

On July 1, 2025, 1,000

shares of Class A Stock were granted as a restricted

The fair value per share

was $ 33.96 , the closing price of the Class A Stock as recorded on the Nasdaq

Global Select Market on July 1, 2025.

This restricted stock award will be fully

vested and released May 6, 2026 and, prior to its vesting date, is subject to

forfeiture in the event of the recipient’s termination of service.

On May 6, 2024, 5,000 shares

of Class A Stock were granted as

restricted stock awards.

The fair value

per share was $ 37.07 , the closing price of the Class A Stock as recorded on the

Nasdaq Global Select Market on May 6, 2024.

These restricted stock awards were fully

vested and released one year after the grant.

Compensation expense of approximately $ 47 thousand and $ 92 thousand was recorded for the three and six months ended June 30, 2025, respectively, for restricted stock awards

issued in May 2024, April 2025, and May 2025.

Compensation expense of approximately $ 57 thousand and $ 125 thousand was recorded for the three and six months ended June 30, 2024, respectively, for restricted stock awards issued in May 2023.

Costs were determined based on the fair value on the dates of the awards and those costs were charged to income over the service periods associated with the awards.

There was no stock compensation cost capitalized as part of an asset.

The following summary reflects changes in the shares of Class A Stock underlying options and restricted stock awards for the three months ended March 31, 2025:

Restricted Awards

Option Shares

Weighted Average Exercise Price

Weighted Average Remaining Life (Yrs.)

Aggregate Intrinsic Value (in thousands)

Outstanding Restricted Stock Awards

Weighted Average

The following summary reflects changes in the shares of Class A Stock underlying options and restricted stock awards for the six months ended June 30, 2025:

Options Restricted Awards

Option Shares Weighted Average Exercise Price Weighted Average Remaining Life (Yrs.) Aggregate Intrinsic Value (in thousands) Outstanding Restricted Stock Awards Weighted Average Grant Date Fair Value

Plan options/restricted stock awards

Outstanding at Janaury 1, 2025

Outstanding at January 1, 2025 - $ - $ - 5,000 $ 37.07

Granted - - - 5,000 34.12

Exercised/vested and released - - - ( 5,000 ) 37.07

Expired/cancelled - - - - -

Outstanding at March 31, 2025

Exercisable/vested at March 31, 2025

There were no options exercised during the three months ended March 31, 2025.

There were no unvested option shares outstanding under the 2015 Plan during the three months ended March 31, 2025 .

As of March 31, 2025, there were no unrecognized expenses related to non-vested option shares granted under the 2015 Plan.

As of March 31, 2025, there was approximately $ 18 thousand total unrecognized expenses related to non-vested awards of restricted shares awarded under the 2015 Plan.

Outstanding at June 30, 2025 - $ - - $ - 5,000 $ 34.12

Exercisable/vested at June 30, 2025 - $ - - $ - - $ -

There were no options exercised during the six months ended June 30, 2025.

There were no unvested option shares outstanding under the 2015 Plan during the six months ended June 30, 2025.

As of June 30, 2025, there were no unrecognized expenses related to non-vested option shares granted under the 2015 Plan.

As of June 30, 2025, there was approximately $ 142 thousand total unrecognized expenses related to non-vested awards of restricted shares awarded under the 2015 Plan.

The cost will be recognized over 0.84 years, the remaining vesting period for the restricted stock awards.

1 unchanged sentence

Artesian Water, Artesian Water Maryland and Artesian Water Pennsylvania provide regulated water utility service to customers within their established service territory in all three counties of Delaware and in portions of Maryland and Pennsylvania, pursuant to rates filed with and approved by the DEPSC, the MDPSC and the PAPUC.

As of March 31, 2025 Artesian Water was serving approximately 97,700 customers, Artesian Water Maryland was serving approximately 2,700 customers and Artesian Water Pennsylvania was serving approximately 40 customers.

As of June 30, 2025, Artesian Water was serving approximately 98,200 customers, Artesian Water Maryland was serving approximately 2,700 customers and Artesian Water Pennsylvania was serving approximately 40 customers.

Artesian Wastewater and TESI provide regulated wastewater utility service to customers within their established service territory in Sussex County, Delaware pursuant to rates filed with and approved by the DEPSC.

As of March 31, 2025, Artesian Wastewater and TESI were serving approximately 8,700 customers combined, including one large industrial customer.

As of June 30, 2025, Artesian Wastewater and TESI were serving approximately 8,800 customers combined, including one large industrial customer.

NOTE 10 – OTHER DEFERRED ASSETS

The investment in CoBank, ACB, or CoBank, which is a cooperative bank, is related to certain outstanding First Mortgage Bonds and is a required investment in the bank based on the underlying long-term debt agreements.

(in thousands)

March 31, 2025

December 31, 2024

(in thousands) June 30, 2025 December 31, 2024

Investment in CoBank $ 6,889 $ 6,425

Other deferred assets 97 100

N OTE 11 – REGULATORY ASSETS

$ 6,986 $ 6,525

NOTE 11 - REGULATORY ASSETS

The ASC 980, Regulated Operations, stipulates generally accepted accounting principles for companies whose rates are established or subject to approvals by a third-party regulatory agency.

18 unchanged sentences

Debt related costs

15 to 30 (based on term of related debt)

(based on term of related debt)

Deferred costs affiliated interest agreement

6 unchanged sentences

(in thousands)

March 31, 2025

December 31, 2024

June 30, 2025 December 31, 2024

Deferred contract costs and other $ 226 $ 271

4 unchanged sentences

Deferred costs affiliated interest agreement 1,026 1,054

Goodwill 247 251

Deferred acquisition and franchise costs - Maryland 370 389

2 unchanged sentences

Unrecovered reserve for depreciation 3,436 3,866

$ 13,593 $ 14,428

NOTE 12 – REGULATORY LIABILITIES

6 unchanged sentences

Deferred settlement refunds consist of reimbursements from the Trust for Artesian Water’s past capital and operating costs, totaling approximately $ 10.0 million, related to the treatment costs associated with the release of contaminants from the Site in groundwater that Artesian Water uses for public potable water supply, pursuant to the Settlement Agreement.

Three installments for approximately $ 2.5 million each were paid in August 2022, July 2023 and July 2024.

The final $ 2.5 million installment payment is due no later than July 2025.

Artesian Water received approval from the DEPSC in October 2022 to refund to its customers these reimbursements for past capital and operating costs.

The refund for the reimbursements is applied to current and future customer bills in annual installments.

The first three refunds occurred in October 2022, August 2023 and August 2024.

The full amount of $ 10.0

million has been paid to us, in four installments of approximately $ 2.5 million each,

in August 2022, July 2023, July 2024 and July 2025.

Artesian Water received approval from the

DEPSC in October 2022 to refund to its customers these reimbursements for past

capital and operating costs.

for the reimbursements was applied to customer bills in annual

installments.

The first three refunds

occurred in October 2022, August 2023 and August 2024.

The final customer refund will occur no later than August 2025.

10 unchanged sentences

(in thousands)

March 31, 2025

December 31, 2024

June 30, 2025 December 31, 2024

Utility plant retirement cost obligation $ 325 $ 279

1 unchanged sentence

Deferred income taxes (related to TCJA) 26,843 27,492

N OTE 13 – REGULATO RY PROCEEDINGS

$ 29,664 $ 30,267

NOTE 13 - REGULATORY PROCEEDINGS

Our water and wastewater utilities generate operating revenue from customers based on rates that are established by state public service commissions through a rate-setting process that may include public hearings, evidentiary hearings and the submission of evidence and testimony in support of the Company’s requested level of rates.

1 unchanged sentence

The DEPSC, regulates Artesian Water, Artesian Wastewater, and TESI.

• The MDPSC, regulates both Artesian Water Maryland and Artesian Wastewater Maryland.

The MDPSC, regulates Artesian Water Maryland and Artesian Wastewater Maryland.

The PAPUC, regulates Artesian Water Pennsylvania.

15 unchanged sentences

On June 12, 2024, a DEPSC order was issued approving the settlement agreement entered into on May 22, 2024 between the Parties.

The Settlement Agreement authorizes a total increase in the revenue requirement of $ 11.2 million, on an annualized basis, or approximately 15.2 %, with a rate effective date of June 12, 2024, which encompasses a 9.5 % return on common equity and an overall rate of return on rate base of 6.75 %.

The Settlement Agreement authorized a total increase in the revenue requirement of $ 11.2 million, on an annualized basis, or approximately 15.2 %, with a rate effective date of June 12, 2024, which encompassed a 9.5 % return on common equity and an overall rate of return on rate base of 6.75 %.

Temporary rates that were in effect since November 28, 2023 were replaced with the final approved rates from the Settlement Agreement.

4 unchanged sentences

The new proposed rates are designed to support Artesian Water’s ongoing capital improvement program and to cover increased costs of operations, including chemicals and electricity for water treatment, water quality regulation compliance, taxes, labor and benefits.

In accordance with applicable Delaware law, Artesian Water is permitted to place into effect temporary rates of up to 15 % of gross water sales, or $ 2.5 million, whichever is lower, on an annual basis, 60 days after the application is filed, subject to refund, until permanent rates are determined by the DEPSC.

Artesian Water has petitioned the DEPSC to implement a temporary incremental increase in rates of 1.22 % effective June 3, 2025, providing approximately $ 1.2 million in additional annual revenue.

In accordance with

applicable Delaware law, the DEPSC approved and Artesian Water implemented the

first temporary rate increase effective June 3, 2025 of approximately $ 2.5

million in additional annual revenue, or 2.88 %, subject to refund, and reduced

the DSIC previously in effect from approximately 1.66 % to zero, for a temporary

rate increase of net 1.22 %.

Other Proceedings

2 unchanged sentences

The DSIC approval process is less costly when compared to the approval process for general rate increase requests.

The DSIC rate applied between base rate filings is capped at 7.50 % of the amount billed to customers under otherwise applicable rates and charges, and the DSIC rate increase applied cannot exceed 5.0 % within an y 12-month period.

The following table summarizes (1) Artesian Water’s last two applications with the DEPSC to collect DSIC rates and (2) the rate upon which eligible plant improvements was based:

8 unchanged sentences

Effective July 1, 2024, Artesian Water was permitted to recover specific investments made in infrastructure through the assessment of a 0.34 % DSIC.

The January 1, 2025 and July 1, 2024 DSIC rates are subject to periodic audit by the DEPSC.

For the three months ended March 31, 2025, we earned approximately $ 0.3 million in DSIC revenue.

For the three months ended March 31, 2024, we did not report any earnings in DSIC revenue.

The January 1, 2025 and

July 1, 2024 DSIC rates are subject to periodic audit by the DEPSC.

The January 1, 2025 DSIC

rate was reset to zero when the temporary base rate increase was placed into effect

on June 3, 2025.

For the three and six

months ended June 30, 2025, we earned approximately $ 0.2 million and $ 0.5

million, respectively in DSIC revenue.

the three and six months ended June 30, 2024, we did not report any earnings in

DSIC revenue.

NOTE 14 - NET INCOME PER COMMON SHARE AND EQUITY PER COMMON SHARE

2 unchanged sentences

The following table summarizes the shares used in computing basic and diluted net income per share:

For the Three Months Ended March 31,

(in thousands)

Three Months Ended Six Months Ended

June 30, June 30,

2025 2024 2025 2024

(in thousands) (in thousands)

Weighted average common shares outstanding during the period for basic computation 10,308 10,293 10,305 10,290

1 unchanged sentence

Weighted average common shares outstanding during the period for diluted computation 10,310 10,295 10,308 10,293

For the three months ended March 31, 2025 and 2024, no shares of restricted stock awards were excluded from the calculations of diluted net income per share.

For the three months ended March 31, 2025 and 2024, no stock options were excluded from the calculations of diluted net income per share.

The Company has 15,000,000 authorized shares of Class A Non-Voting Stock, and 1,040,000 authorized shares of Class B Stock.

As of March 31, 2025, 9,421,542 shares of Class A Non-Voting Stock and 881,452 shares of Class B Stock were issued and outstanding.

As of March 31, 2024 , 9,406,808 shares of Class A Non-Voting Stock and 881,452 shares of Class B Stock were issued and outstanding.

For the three months and six months ended June 30, 2025 and 2024, no shares of restricted stock awards were excluded from the calculations of diluted net income per share.

For the three and six months ended June 30, 2025 and 2024, no stock options were excluded from the calculations of diluted net income per share.

The Company has 15,000,000 authorized shares of Class A Stock and 1,040,000 authorized shares of Class B Stock.

As of June 30, 2025, 9,429,077 shares of Class A Stock and 881,452 shares of Class B Stock were issued and outstanding.

As of June 30, 2024, 9,414,094 shares of Class A Stock and 881,452 shares of Class B Stock were issued and outstanding.

The par value for both classes is $ 1.00 per share.

Equity per common share was $ 23.46 and $ 23.24 at March 31, 2025 and December 31, 2024 , respectively.

These amounts were computed by dividing common stockholders’ equity by the number of weighted average shares of common stock outstanding on March 31, 2025 and December 31, 2024 , respectively.

Equity per common share was $ 23.77 and $ 23.24 at June 30, 2025 and December 31, 2024, respectively.

These amounts were computed by dividing common stockholders' equity by the number of weighted average shares of common stock outstanding on June 30, 2025 and December 31, 2024, respectively.

NOTE 15 - LEGAL PROCEEDINGS

9 unchanged sentences

Claims Forms have been submitted on behalf of Artesian Resources’ eligible systems in each of the Settlements.

The amount of recovery, if any, by Artesian Resources’ subsidiaries is uncertain.

The amount of recovery by Artesian Resources’ subsidiaries is uncertain.

NOTE 16 - BUSINESS SEGMENT INFORMATION

10 unchanged sentences

The measurement of depreciation, interest, and capital expenditures are predominately related to our Regulated Utility segment.

These amounts in our non-utility business are negligible and account for approximately less than 1% of condensed consolidated amounts as of March 31, 2025 and March 31, 2024.

Three Months Ended March 31,

These amounts in our non-utility business are negligible and account for approximately less than 1% of condensed consolidated amounts as of June 30, 2025 and June 30, 2024.

Three Months Ended June 30,

Regulated Utility Total Regulated Utility Total

Regulated Utility Revenues $ 26,723 $ 26,723 $ 25,789 $ 25,789

Reconciliation of revenue

Other revenues

Other revenues 1,891 (a) 1,685 (a)

Inter-segment elimination ( 65 ) ( 58 )

4 unchanged sentences

Depreciation and Amortization 3,401 3,412

Income Taxes 1,866 1,725

Property and other taxes 1,585 1,507

1 unchanged sentence

Reconciliation of operating income

Other profit 554 (a) 291 (a)

Consolidated operating income $ 7,855 $ 7,198

March 31, 2025

March 31, 2024

Six Months Ended June 30,

Regulated Utility Total Regulated Utility Total

Regulated Utility Revenues $ 50,768 $ 50,768 $ 48,630 $ 48,630

Reconciliation of revenue

Other revenues 3,795 (a) 3,448 (a)

Inter-segment elimination ( 128 ) ( 118 )

Consolidated revenues $ 54,435 $ 51,960

Payroll and Benefits (c) 12,394 12,612

Supply and Delivery (d) 7,521 7,127

Administrative (e) 5,043 4,515

Depreciation and Amortization 6,745 6,863

Income Taxes 3,450 3,151

Property and other taxes 3,253 3,097

Regulated Utility Operating Income $ 12,362 $ 12,362 $ 11,265 $ 11,265

Reconciliation of operating income

Other profit 1,038 (a) 652 (a)

Consolidated operating income $ 13,400 $ 11,917

Regulated Utility Total Regulated Utility Total

Regulated Utility Assets $ 815,090 $ 815,090 $ 793,118 $ 793,118

Reconciliation of assets

Other assets 4,206 5,505

Consolidated assets $ 819,296 $ 798,623

31 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements