MIDDLESEX WATER CO 10-Q

Item 1. Financial Statements (Unaudited): MIDDLESEX WATER COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands except per share amounts) Three Months Ended March 31, 2026 2025 Operating Revenues $ 48,714 $ 44,301 Operating Expenses: Operations and Maintenance 23,012 21,109 Depreciation 7,036 6,527 Other Taxes 5,564 5,108 Total Operating Expenses 35,612 32,744 Operating Income 13,102 11,557 Other Income: Allowance for Funds Used During Construction 633 372 Other Income, net 1,369 1,425 Total Other Income, net 2,002 1,797 Interest Charges 3,214 2,713 Income before Income Taxes 11,890 10,641 Income Taxes 1,285 1,162 Net Income 10,605 9,479 Preferred Stock Dividend Requirements 18 22 Earnings Applicable to Common Stock $ 10,587 $ 9,457 Earnings per share of Common Stock: Basic $ 0.57 $ 0.53 Diluted $ 0.57 $ 0.53 Average Number of Common Shares Outstanding: Basic 18,545 17,890 Diluted 18,575 17,951 See Accompanying Notes to Condensed Consolidated Financial Statements. 1 Table of Contents MIDDLESEX WATER COMPANY CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands) March 31, 2026 December 31, 2025 ASSETS UTILITY PLANT: Water Production $ 333,738 $ 328,496 Transmission and Distribution 954,107 938,118 General 107,783 111,325 Construction Work in Progress 49,593 44,400 TOTAL 1,445,221 1,422,339 Less Accumulated Depreciation 276,456 275,132 UTILITY PLANT - NET 1,168,765 1,147,207 CURRENT ASSETS: Cash and Cash Equivalents 2,040 2,800 Accounts Receivable, net of allowance for credit losses of $ 1,873 and $ 1,625 in 2026 and 2025, respectively 18,690 19,213 Unbilled Revenues 10,347 9,361 Materials and Supplies (at average cost) 8,095 7,549 Prepayments 5,986 2,843 Regulatory Assets 1,669 — TOTAL CURRENT ASSETS 46,827 41,766 OTHER ASSETS: Operating Lease Right of Use Asset 1,830 1,972 Restricted Cash 1,675 1,675 Regulatory Assets 103,001 110,284 Non-utility Assets - Net 12,454 12,354 Employee Benefit Plans 45,041 44,328 Other 6,445 6,151 TOTAL OTHER ASSETS 170,446 176,764 TOTAL ASSETS $ 1,386,038 $ 1,365,737 CAPITALIZATION AND LIABILITIES CAPITALIZATION: Common Stock, No Par Value, authorized 40,000 , issued 18,577 and 18,521 in 2026 and 2025, respectively $ 282,243 $ 279,148 Retained Earnings 218,803 214,883 TOTAL COMMON EQUITY 501,046 494,031 Preferred Stock, No Par Value; authorized 120 ; issued 13 1,343 1,343 Long-term Debt 371,676 378,874 TOTAL CAPITALIZATION 874,065 874,248 CURRENT Current Portion of Long-term Debt 7,666 7,850 LIABILITIES: Notes Payable 47,000 28,250 Accounts Payable 29,496 31,326 Accrued Taxes 22,116 15,992 Accrued Interest 3,291 3,311 Regulatory Liabilities 3,142 — Unearned Revenues and Advanced Service Fees 467 497 Other 6,477 6,569 TOTAL CURRENT LIABILITIES 119,655 93,795 COMMITMENTS AND CONTINGENT LIABILITIES (Note 7) OTHER LIABILITIES: Advances for Construction 25,963 25,519 Lease Obligations 1,653 1,838 Accumulated Deferred Income Taxes 111,152 110,475 Regulatory Liabilities 61,365 68,437 Other 195 229 TOTAL OTHER LIABILITIES 200,328 206,498 CONTRIBUTIONS IN AID OF CONSTRUCTION 191,990 191,196 TOTAL CAPITALIZATION AND LIABILITIES $ 1,386,038 $ 1,365,737 See Accompanying Notes to Condensed Consolidated Financial Statements. 2 Table of Contents MIDDLESEX WATER COMPANY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) Three Months Ended March 31, 2026 2025 CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 10,605 $ 9,479 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation and Amortization 8,187 7,913 Provision for Deferred Income Taxes and Investment Tax Credits ( 2,072 ) ( 1,142 ) Equity Portion of Allowance for Funds Used During Construction (AFUDC) ( 384 ) ( 218 ) Cash Surrender Value of Life Insurance 80 88 Stock Compensation Expense 401 389 Changes in Assets and Liabilities: Accounts Receivable 523 ( 1,279 ) Unbilled Revenues ( 986 ) 480 Materials & Supplies ( 546 ) ( 312 ) Prepayments ( 3,143 ) ( 3,984 ) Accounts Payable ( 2,132 ) ( 195 ) Accrued Taxes 6,124 5,468 Accrued Interest ( 20 ) ( 460 ) Employee Benefit Plans ( 1,199 ) ( 1,324 ) Unearned Revenue & Advanced Service Fees ( 30 ) 59 Other Assets and Liabilities ( 3,677 ) ( 1,180 ) NET CASH PROVIDED BY OPERATING ACTIVITIES 11,731 13,782 CASH FLOWS FROM INVESTING ACTIVITIES: Utility Plant Expenditures, Including AFUDC-Debt of $ 249 in 2026 and $ 154 in 2025 ( 20,641 ) ( 18,911 ) NET CASH USED IN INVESTING ACTIVITIES ( 20,641 ) ( 18,911 ) CASH FLOWS FROM FINANCING ACTIVITIES: Redemption of Long-term Debt ( 8,904 ) ( 1,587 ) Proceeds from Issuance of Long-term Debt 1,496 28 Net Short-term Bank Borrowings 18,750 11,000 Payment of Grantee Withholding Taxes in Exchange for Restricted Stock ( 125 ) ( 225 ) Proceeds from Issuance of Common Stock 2,819 221 Payment of Common Dividends ( 6,667 ) ( 6,081 ) Payment of Preferred Dividends ( 18 ) ( 22 ) Construction Advances and Contributions-Net 799 226 NET CASH PROVIDED BY FINANCING ACTIVITIES 8,150 3,560 NET CHANGES IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH ( 760 ) ( 1,569 ) CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD 4,475 4,226 CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD $ 3,715 $ 2,657 See Accompanying Notes to Condensed Consolidated Financial Statements. 3 Table of Contents MIDDLESEX WATER COMPANY CONDENSED CONSOLIDATED STATEMENTS OF CAPITAL STOCK AND LONG-TERM DEBT (Unaudited) (In thousands) March 31, 2026 December 31, 2025 Common Stock, No Par Value Shares Authorized - 40,000 Shares Outstanding -2026 - 18,577 ; 2025 - 18,521 $ 282,243 $ 279,148 Retained Earnings 218,803 214,883 TOTAL COMMON EQUITY $ 501,046 $ 494,031 Cumulative Preferred Stock, No Par Value: Shares Authorized - 120 Shares Outstanding -2026 - 13 ; 2025 - 13 Convertible: Shares Outstanding, $ 7.00 Series - 2026 - 2 ; 2025 - 2 ; $ 264 $ 264 Nonredeemable: Shares Outstanding, $ 7.00 Series - 1 79 79 Shares Outstanding, $ 4.75 Series - 10 1,000 1,000 TOTAL PREFERRED STOCK $ 1,343 $ 1,343 Long-term Debt: First Mortgage Bonds, 0.00 %- 5.99 %, due 2026-2059 $ 300,431 $ 301,172 Secured Notes, 3.94 %- 7.05 %, due 2028-2046 56,159 63,971 State Revolving Trust Notes, 0.00 %- 4.03 %, due 2026-2047 21,685 20,540 SUBTOTAL LONG-TERM DEBT 378,275 385,683 Add: Premium on Issuance of Long-term Debt 6,099 6,148 Less: Unamortized Debt Expense ( 5,032 ) ( 5,107 ) Less: Current Portion of Long-term Debt ( 7,666 ) ( 7,850 ) TOTAL LONG-TERM DEBT $ 371,676 $ 378,874 See Accompanying Notes to Condensed Consolidated Financial Statements. 4 Table of Contents MIDDLESEX WATER COMPANY CONDENSED CONSOLIDATED STATEMENTS OF COMMON STOCKHOLDERS' EQUITY (Unaudited) (In thousands) Common Stock Shares Common Stock Amount Retained Earnings Total Balance at January 1, 2025 17,887 $ 248,202 $ 197,061 $ 445,263 Net Income — — 9,479 9,479 Dividend Reinvestment & Common Stock Purchase Plan 4 221 — 221 Restricted Stock Award -Net-Employees 1 167 — 167 Conversion of $ 7 Preferred Stock to Common Stock 2 21 — 21 Cash Dividends on Common Stock ($ 0.3400 Per Share) — — ( 6,081 ) ( 6,081 ) Cash Dividends on Preferred Stock — — ( 22 ) ( 22 ) Balance at March 31, 2025 17,894 $ 248,611 $ 200,437 $ 449,048 Balance at January 1, 2026 18,521 $ 279,148 $ 214,883 $ 494,031 Net Income — — 10,605 10,605 Dividend Reinvestment & Common Stock Purchase Plan 4 217 — 217 Restricted Stock Award -Net-Employees 3 276 — 276 At-The-Market Program Common Stock Issuance 49 2,662 — 2,662 Common Stock Issuance Expense — ( 60 ) — ( 60 ) Cash Dividends on Common Stock ($ 0.3600 Per Share) — — ( 6,667 ) ( 6,667 ) Cash Dividends on Preferred Stock — — ( 18 ) ( 18 ) Balance at March 31, 2026 18,577 $ 282,243 $ 218,803 $ 501,046 See Accompanying Notes to Condensed Consolidated Financial Statements. 5 Table of Contents MIDDLESEX WATER COMPANY NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Note 1 – Basis of Presentation and Recent Developments Middlesex Water Company (Middlesex or the Company) is the parent company and sole shareholder of Tidewater Utilities, Inc. (Tidewater), Utility Service Affiliates, Inc. (USA), and Utility Service Affiliates (Perth Amboy) Inc. (USA-PA). Southern Shores Water Company, LLC (Southern Shores) and White Marsh Environmental Systems, Inc. (White Marsh) are wholly-owned subsidiaries of Tidewater. Pinelands Water Company (Pinelands Water) and Pinelands Wastewater Company (Pinelands Wastewater) (collectively, Pinelands), previously subsidiaries of Middlesex, were merged into Middlesex effective April 1, 2026 (for further information, see Note 2, Rates and Regulatory Matters) . The financial statements for Middlesex and its wholly-owned subsidiaries are reported on a consolidated basis. All significant intercompany accounts and transactions have been eliminated. The consolidated notes within the 2025 Annual Report on Form 10-K (the 2025 Form 10-K) are applicable to these financial statements and, in the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary (including normal recurring accruals) to fairly state the Company’s financial position as of March 31, 2026, and the results of operations and cash flows for the three month periods ended March 31, 2026 and 2025. Information included in the Condensed Consolidated Balance Sheet as of December 31, 2025, has been derived from the Company’s December 31, 2025 audited financial statements included in the 2025 Form 10-K. Recent Accounting Guidance The recently issued accounting standards that have not yet been adopted by the Company as of March 31, 2026 are as follows: Standard Description Date of Adoption Application Effect on the Condensed Consolidated Financial Statements Accounting Standards Update (ASU) 2024-03 “Disaggregation of Income Statement Expenses” The ASU enhances disclosures related to income statement expenses to further disaggregate expenses in the footnotes to the financial statements. The standard requires disaggregation of any relevant expense caption presented on the face of the income statement that contains the following expense categories: purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion. Further, the standard requires disclosure of the total amount and the entity’s definition of selling expenses. The ASU is effective for the Company beginning with its annual financial statements for the year ending December 31, 2027. Prospective, with retrospective application also permitted. The Company is evaluating the impact of ASU 2024-03 on its Consolidated Financial Statements. ASU 2025-06 "Internal-Use Software" This ASU removes all reference to prescriptive and sequential software development stages, requiring an entity to start capitalizing software costs when the following criteria are both met: (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. Further, the standard requires disclosure for all capitalized internal-use software costs and removes the requirement for intangibles disclosures for capitalized internal-use software. The ASU is effective for the Company beginning with its annual financial statements for the year ending December 31, 2028. Prospective, with a modified transition or retrospective application also permitted. The Company is evaluating the impact of ASU 2025-06 on its Consolidated Financial Statements. 6 Table of Contents Note 2 – Rates and Regulatory Matters Middlesex Rate Matters In February 2026, the New Jersey Board of Public Utilities (NJBPU) approved the settlement agreement in our general base rate application between Middlesex and Pinelands, NJBPU Staff and the New Jersey Division of Rate Counsel, with new rates effective February 23, 2026. The NJBPU order approved an increase in our annual operating revenues by $ 14.5 million based on an authorized return on common equity of 9.6 % and a common equity ratio of 54.25 %. Included in the settlement agreement, Middlesex and Pinelands customers received a one-time bill credit in the first quarter of 2026 totaling $ 3.3 million for the overcollection of New Jersey Gross Receipts Taxes. In addition, beginning in late February 2026, Middlesex customers will receive a $ 3.3 million credit over 12 months from the proceeds of a multi-district litigation (MDL) settlement agreement between Middlesex and manufacturers of Perfluoroalkyl Substances (PFAS) (for further information on the MDL settlement, see MDL Settlement below). In February 2026, the NJBPU approved the joint petition filed by Middlesex and Pinelands for a Resiliency and Environmental System Improvement Charge (RESIC) Foundational Filing for the three-year period ending October 2028. The program allows for the recovery of certain costs of investments that further maintain, enhance, or improve the resiliency, health, safety, or environmental protection for Middlesex and Pinelands customers or broader public health. RESIC activities include compliance with requirements to address existing and emerging chemical elements and compounds, treatment media and related equipment, installation of new plant or equipment, or replacement of existing plant or equipment. Under the RESIC program, Middlesex and Pinelands submit semi-annual surcharge filings to the NJBPU for qualifying capital investments completed every six months to be recovered up to $ 3.6 million or 2.5 % of total annual revenues included in their February 2026 base rate increase. In February 2026, the NJBPU approved the joint petition filed by Middlesex and Pinelands Water for a Distribution System Improvement Charge (DSIC) Foundational Filing, which allows for the recovery of investments in qualifying capital improvements to their water distribution system for the three-year period ending October 2028. Under the DSIC program, Middlesex and Pinelands Water submit semi-annual surcharge filings to the NJBPU for qualifying capital investments completed every six months to be recovered up to $ 7.1 million or 5 % of total annual revenues included in their February 2026 base rate increase. In January 2026, the NJBPU approved the joint petition filed by Middlesex, Pinelands Water and Pinelands Wastewater to consolidate the three entities into Middlesex through a corporate reorganization. The merger of Pinelands Water and Pinelands Wastewater into Middlesex is expected to deliver operational efficiencies and enhanced benefits for customers across multiple areas. The merger has been finalized and was effective on April 1, 2026. In November 2025, the NJBPU approved the fourth Middlesex DSIC rate, effective December 1, 2025 that was expected to result in $ 0.9 million of annual revenues, which is in addition to the existing $ 2.3 million of annual revenues from previous DSIC filings. Middlesex's DSIC rate reset to zero in connection with Middlesex's February 2026 base rate increase. The NJBPU-approved Middlesex Lead Service Line Replacement (LSLR) Plan continues, and costs of $ 0.4 million for replacing customer-owned lead service lines incurred from January 2025 through June 2025 were recovered between September 2025 and February 2026. Costs of $ 0.3 million incurred from July 2025 through December 2025 are expected to be recovered between March 2026 and August 2026. The LSLR surcharge is required to be reset every six months over the life of the LSLR Plan. Cost recovery for replacing Company-owned lead service lines are recoverable through traditional rate making in connection with general rate case filings. Tidewater Rate Matters In February 2026, the Delaware Public Service Commission (DEPSC) approved the March 2026 refund of $ 1.1 million to Tidewater customers resulting from the proceeds of the MDL settlement agreement between Tidewater and manufacturers of PFAS. For further information, see discussion in MDL Settlement below. In January 2026, Tidewater completed the acquisition of the water utility assets of Pinewood Acres, LLC, as approved by the DEPSC, for $ 0.2 million. Pinewood Acres serves approximately 350 customers in Kent County, Delaware. In December 2025, the DEPSC approved the Tidewater DSIC rate, effective January 1, 2026. Tidewater is expected to recover approximately $ 0.3 million of semi-annual DSIC revenues between January 2026 and June 2026. 7 Table of Contents In July 2025, the DEPSC approved the settlement agreement in our general base rate application between Tidewater, DEPSC Staff and the Delaware Division of the Public Advocate, with new rates effective July 3, 2025. The DEPSC order approved an increase in our annual operating revenues by $ 5.5 million based on an authorized return on common equity of 9.5 % and a common equity ratio of 53.5 %. MDL Settlement Multiple Company utility subsidiaries are parties to the aforementioned MDL lawsuit against manufacturers of certain PFAS for damages, contribution and reimbursement of costs incurred and continuing to be incurred to address the presence of such PFAS in public water supply systems owned and operated by these utility subsidiaries and throughout their service areas. Settlements with several defendants in the MDL have received final approval by the MDL court. The Company began receiving settlement payments in 2025, which will continue through 2026 and beyond. As of March 31, 2026, the Company received $ 6.0 million. Proceeds from these settlement payments have been and will likely continue to be shared with customers in the future (for further information on 2026 customer refunds related to the MDL settlement, see Middlesex Rate Matters and Tidewater Rate Matters above). Southern Shores Rate Matters Southern Shores provides water service to a 2,200 unit condominium community in Sussex County, Delaware under a DEPSC-approved agreement expiring December 31, 2029. Under the agreement, rates are increased annually by the lesser of the regional Consumer Price Index or 3 %. Additionally, when there are unanticipated capital expenditures or regulatory related changes in operating expenses exceed certain annual thresholds, rates are increased. In 2024, capital expenditures did exceed the established threshold. Effective January 1, 2025, Southern Shores rates were increased $ 0.1 million or 6.51 %. In 2025, Southern Shores capital expenditures exceeded the established threshold. Effective January 1, 2026, Southern Shores rates were increased $ 0.1 million or 4.89 %. Note 3 – Capitalization Sales of shares of common stock and issuance of long-term debt are part of the Company’s comprehensive financing plan to fund its multi-year utility plant infrastructure investment program. Common Stock During the three months ended March 31, 2026 and 2025, there were 4,025 common shares (approximately $ 0.2 million) and 4,228 common shares (approximately $ 0.2 million), respectively, issued under the Middlesex Water Company Investment Plan. In May 2025, Middlesex entered into an At-the-Market (ATM) Equity Offering Sales Agreement (Equity Sales Agreement) with BofA Securities, Inc., Robert W. Baird & Co. Incorporated and Janney Montgomery Scott LLC (Janney), pursuant to which Middlesex may offer and sell shares of its common stock, no par value per share, from time to time in “at-the-market” offerings, having an aggregate gross sales price of up to $ 110.0 million. As of February 20, 2026, the Equity Sales Agreement was amended, replacing Janney with Huntington Securities, Inc. as a sales agent. The Company intends to use the net proceeds from these sales, after deducting commissions and offering expenses, to fund our capital expenditures, to purchase and maintain plant equipment, as well as for other general corporate purposes. For the three months ended March 31, 2026, Middlesex issued and sold a total of 49,305 shares of common stock, at a weighted average price of $ 54.82 per share, and received $ 2.7 million in net proceeds, under the Equity Sales Agreement. As of March 31, 2026, the Company had $ 77.3 million of aggregate gross sales remaining under the Equity Sales Agreement. Long-term Debt Subject to regulatory approval, the Company periodically issues long-term debt to fund its investments in utility plant. To the extent possible and fiscally prudent, the Company finances qualifying capital projects under State Revolving Fund (SRF) loan programs in New Jersey and Delaware. These government programs provide financing at interest rates typically below rates available in the broader financial markets. In September 2024, Tidewater closed on a $ 2.2 million Delaware SRF loan with a 0.0 % interest rate with maturity dates in 2044. This loan is for costs associated with Tidewater’s obligation, as required by federal law and Delaware regulations, to 8 Table of Contents identify and inventory lead service lines throughout Tidewater’s service area. Tidewater has drawn down $ 1.8 million as of March 31, 2026 and expects that the requisitions will continue through 2026. In May 2024, Tidewater closed on four Delaware SRF loans totaling $ 5.6 million, all at interest rates of 2.0 % with maturity dates in 2044. These loans are for the construction, relocation, improvement, and/or interconnection of transmission mains and construction of a water treatment facility. In December 2025, Tidewater closed on an additional $ 1.0 million, 2.0 % SRF loan with a maturity date of 2045 related to these projects. Tidewater has drawn down $ 2.1 million on these loans as of March 31, 2026. Each project has its own construction timetable with the last spending set to occur in 2027. In December 2025, Southern Shores closed on a $ 0.4 million Delaware SRF loan with a 0.0 % interest rate with a maturity date in 2045. This loan is for costs associated with Southern Shore’s obligation, as required by federal law and Delaware regulations, to identify and inventory lead service lines in its service area. As of March 31, 2026, Southern Shores has drawn down $ 0.2 million on these loans. In February 2026, Pinelands Water and Pinelands Wastewater repaid in full $ 3.7 million and $ 3.4 million, respectively, of their amortizing secured notes. The interest rates and due dates on both of these notes were 6.17 % and 2043, respectively. Fair Value of Financial Instruments The following methods and assumptions were used by the Company in estimating its fair value disclosure for financial instruments for which it is practicable to estimate that value. The carrying amounts reflected in the condensed consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable and notes payable approximate their respective fair values due to the short-term maturities of these instruments. The fair value of First Mortgage Bonds (FMBs) and SRF Bonds (collectively, the Bonds) issued by Middlesex is based on quoted market prices for similar issues. Under the fair value hierarchy, the fair value of cash and cash equivalents is classified as a Level 1 measurement and the fair value of notes payable and the FMBs in the table below are classified as Level 2 measurements. The carrying amount and fair value of the FMBs were as follows: (Thousands of Dollars) March 31, 2026 December 31, 2025 Carrying Amount Fair Value Carrying Amount Fair Value FMBs $ 125,431 $ 119,770 $ 126,172 $ 120,430 It was not practicable to estimate the fair value on our outstanding long-term debt for which there is no quoted market price and there is not an active trading market. For details, including carrying value, interest rates and due dates on these series of long-term debt, please refer to those series noted as “Secured Notes” and “State Revolving Trust Notes” on the Condensed Consolidated Statements of Capital Stock and Long-Term Debt. The carrying amount of these instruments was $ 252.8 million and $ 259.5 million at March 31, 2026 and December 31, 2025, respectively. Advances for construction have carrying amounts of $ 26.0 million and $ 25.5 million at March 31, 2026 and December 31, 2025, respectively. Their relative fair values cannot be accurately estimated since future refund payments depend on several variables, including new customer connections, customer consumption levels and future rate increases. Substantially all of the utility plant of the Company is subject to the lien of its mortgage, which includes debt service and capital ratio covenants. The Company is in compliance with all of its mortgage covenants and restrictions. 9 Table of Contents Note 4 – Earnings Per Share Basic earnings per share (EPS) are computed on the basis of the weighted average number of shares outstanding during the period presented. Diluted EPS assumes the conversion of the Convertible Preferred Stock $ 7.00 Series. (In Thousands Except per Share Amounts) Three Months Ended March 31, 2026 2025 Basic: Income Shares Income Shares Net Income $ 10,605 18,545 $ 9,479 17,890 Preferred Dividend ( 18 ) ( 22 ) Earnings Applicable to Common Stock $ 10,587 18,545 $ 9,457 17,890 Basic EPS $ 0.57 $ 0.53 Diluted: Earnings Applicable to Common Stock $ 10,587 18,545 $ 9,457 17,890 $ 7.00 Series Preferred Dividend 4 30 10 61 Adjusted Earnings Applicable to Common Stock $ 10,591 18,575 $ 9,467 17,951 Diluted EPS $ 0.57 $ 0.53 Note 5 – Business Segment Data The Company’s Chief Operating Decision Maker (CODM) consists of the Company’s Chief Executive Officer, Chief Financial Officer, and Chief Operating Officer. The CODM evaluates segment performance and profitability using net income. This metric provides a clear, consistent basis for analyzing the financial results of each segment and supports decision-making regarding the allocation of resources. Resource allocation to the Company’s regulated and non-regulated segments begins with the annual budgeting process, which establishes initial funding and resource levels for each segment. The budget incorporates key financial and operational inputs, including anticipated revenues, expenses, capital and financing requirements, aligning with the Company’s strategic objectives and regulatory obligations. The CODM reviews budget-to-actual variances on a monthly, quarterly and year to-date basis and makes interim decisions to reallocate resources among segments as needed, ensuring a timely and effective response to changing conditions. For the regulated segment, the CODM uses this assessment to determine whether the segment is achieving its regulatory authorized rate of return. The segments follow the same accounting policies as described in Note 1 – Organization, Summary of Significant Accounting Policies and Recent Developments of the 2025 Form 10-K. Segment profit or loss is based on Net Income. Expenses used to determine operating income before taxes are charged directly to each segment or are allocated based on the applicable cost allocation factors. Assets allocated to each segment are based upon specific identification of such assets provided by Company records. The effects of all intra-segment and/or intercompany transactions are eliminated in the consolidated financial statements. The Company has identified two reportable segments. One is the regulated business of collecting, treating and distributing water on a retail and wholesale basis to residential, commercial, industrial and fire protection customers in parts of New Jersey and Delaware and includes Middlesex, Tidewater, Pinelands and Southern Shores. This segment also includes a regulated wastewater system in New Jersey, Pinelands Wastewater. The Company is subject to regulations as to its rates, services and other matters by the states of New Jersey and Delaware with respect to utility service within these states. The other segment is primarily comprised of non-regulated contract services for the operation and maintenance of municipal and private water and wastewater systems in New Jersey and Delaware and includes USA, USA-PA, and White Marsh. 10 Table of Contents (In Thousands) Three months ended March 31, 2026 2025 Operation by Segments Operating Revenues: Regulated $ 45,780 $ 41,496 Non – Regulated 3,089 2,952 Total Reportable Segments 48,869 44,448 Inter-segment Elimination ( 155 ) ( 147 ) Consolidated Operating Revenues $ 48,714 $ 44,301 Operating Expenses Purchased Water: Regulated $ 1,941 $ 1,907 Non – Regulated — — Total Reportable Segments 1,941 1,907 Inter-segment Elimination ( 34 ) ( 28 ) Consolidated Purchased Water $ 1,907 $ 1,879 Other Operations and Maintenance Expenses: Regulated $ 18,988 $ 17,493 Non – Regulated 2,238 1,856 Total Reportable Segments 21,226 19,349 Inter-segment Elimination ( 121 ) ( 119 ) Consolidated Other Operations and Maintenance Expenses $ 21,105 $ 19,230 Other Taxes: Regulated $ 5,496 $ 5,050 Non – Regulated 68 $ 58 Consolidated Other Taxes $ 5,564 $ 5,108 Depreciation: Regulated $ 6,963 $ 6,464 Non – Regulated 73 $ 63 Consolidated Depreciation $ 7,036 $ 6,527 Operating Income: Regulated $ 12,512 $ 10,701 Non – Regulated 590 $ 856 Consolidated Operating Income $ 13,102 $ 11,557 Other Income: Regulated $ 2,177 $ 1,901 Non – Regulated 25 55 Total Reportable Segments 2,202 1,956 Inter-segment Elimination ( 200 ) ( 159 ) Consolidated Other Income, Net $ 2,002 $ 1,797 11 Table of Contents (In Thousands) Three months ended March 31, 2026 2025 Operation by Segments (continued) Interest Charges: Regulated $ 3,414 $ 2,872 Non – Regulated — — Total Reportable Segments 3,414 2,872 Inter-segment Elimination ( 200 ) ( 159 ) Consolidated Interest Charges $ 3,214 $ 2,713 Income Taxes: Regulated $ 1,073 $ 872 Non – Regulated 212 $ 290 Consolidated Income Taxes $ 1,285 $ 1,162 Net Income: Regulated $ 10,202 $ 8,858 Non – Regulated 403 $ 621 Consolidated Net Income $ 10,605 $ 9,479 Capital Expenditures: Regulated $ 20,574 $ 18,853 Non – Regulated 67 $ 58 Total Capital Expenditures $ 20,641 $ 18,911 (Thousands of Dollars) As of March 31, 2026 As of December 31, 2025 Assets: Regulated $ 1,398,877 $ 1,377,391 Non – Regulated 9,018 9,076 Total Reportable Segments 1,407,895 1,386,467 Inter-segment Elimination ( 21,857 ) ( 20,730 ) Consolidated Assets $ 1,386,038 $ 1,365,737 Note 6 – Short-term Borrowings The Company maintains lines of credit aggregating $ 180.0 million. (Millions) As of March 31, 2026 Line of Credit Outstanding Available Maximum Credit Type Expiration Date Bank of America $ — $ 60.0 $ 60.0 Uncommitted July 31, 2026 PNC Bank 27.0 73.0 100.0 Committed January 31, 2029 CoBank, ACB (CoBank) 20.0 — 20.0 Committed May 20, 2028 $ 47.0 $ 133.0 $ 180.0 12 Table of Contents In February 2026, the Company amended its line of credit with PNC Bank. Under the terms of the amendment, the expiration date was extended to January 31, 2029 and the maximum borrowing amount was increased to $ 100 million. The maturity dates for the Notes Payable as of March 31, 2026 are all three months or less and are extendable at the discretion of the Company. The interest rates are set for borrowings under the Bank of America and PNC Bank lines of credit using the Secured Overnight Financing Rate (SOFR) and then adding a specific financial institution credit spread. The interest rate for borrowings under the CoBank line of credit are set weekly using CoBank’s internal cost of funds index that is similar to the SOFR and adding a credit spread. There is no requirement for a compensating balance under any of the established lines of credit. The weighted average interest rate on the outstanding borrowings at March 31, 2026 under these credit lines is 4.87 %. The weighted average daily amounts of borrowings outstanding under these credit lines and the weighted average interest rates on those amounts were as follows: (In Thousands) Three months ended March 31, 2026 2025 Average Daily Amounts Outstanding $ 42,218 $ 29,067 Weighted Average Interest Rates 4.80 % 5.43 % Note 7 – Commitments and Contingent Liabilities Water Supply – Middlesex's agreement with the New Jersey Water Supply Authority (NJWSA) for the purchase of untreated water expires November 30, 2048. NJWSA provides for an average purchase of 27.0 million gallons a day (mgd) with a peak up to 47.0 mgd. Pricing is set annually by the NJWSA through a public rate making process. The agreement has provisions for additional pricing in the event Middlesex overdrafts or exceeds certain monthly and annual thresholds. Middlesex also has an agreement with a non-affiliated NJBPU-regulated water utility for the purchase of treated water. This agreement, which expires February 27, 2031, provides for the minimum purchase of 3.0 mgd of treated water with provisions for additional purchases if needed. Tidewater contracts with the City of Dover in Delaware to purchase treated water of up to 75.0 million gallons annually. Purchased water costs are shown below: (In Thousands) Three months ended March 31, 2026 2025 Treated $ 887 $ 887 Untreated 1,020 992 Total Costs $ 1,907 $ 1,879 Construction – In connection with the Company’s planned capital expenditures, the Company has entered into several contractual construction agreements that in total obligate it to expend an estimated $ 42.3 million in the future. The actual amount and timing of capital expenditures is dependent on the need for replacement of existing infrastructure, customer growth, residential new home construction and sales, project scheduling, supply chain and continued refinement of project scope and costs. Contingencies – Based on our operations in the heavily-regulated water and wastewater industries, the Company is routinely involved in disputes, claims, lawsuits and other regulatory and legal matters, including responsibility for fines and penalties relative to regulatory compliance. At this time, Management does not believe the final resolution of any such matters, whether asserted or unasserted, will have a material adverse effect on the Company’s financial position, results of 13 Table of Contents operations or cash flows. In addition, the Company maintains business insurance coverage that may mitigate the effect of any current or future loss contingencies. Change in Control Agreements – The Company has Change in Control Agreements with its executive officers that provide compensation and benefits in the event of termination of employment under certain conditions in connection with a change in control of the Company. Note 8 – Employee Benefit Plans Pension Benefits The Company’s Pension Plan covers all active employees hired prior to April 1, 2007. Employees hired after March 31, 2007 are not eligible to participate in this plan, but can participate in a defined contribution profit sharing plan that provides an annual contribution at the discretion of the Company, based upon a percentage of the participants’ annual paid compensation. For each of the three-month periods ended March 31, 2026 and 2025, the Company did not make cash contributions to the Pension Plan. The Company expects to make cash contributions of approximately $ 0.9 million over the remainder of the current year. Other Benefits The Company’s Other Benefits Plan covers substantially all of its current retired employees. Employees hired after March 31, 2007 are not eligible to participate in this plan. Coverage includes healthcare and life insurance. For each of the three-month periods ended March 31, 2026 and 2025, the Company did not make cash contributions to its Other Benefits Plan. The Company expects to make additional Other Benefits Plan cash contributions of $ 1.1 million over the remainder of the current year. The following tables set forth information relating to the Company’s periodic costs (benefit) for its employee retirement benefit plans: (In Thousands) Pension Benefits Other Benefits Three Months Ended March 31, 2026 2025 2026 2025 Service Cost $ 286 $ 242 $ 86 $ 85 Interest Cost 1,209 1,159 441 430 Expected Return on Assets ( 1,591 ) ( 1,687 ) ( 1,021 ) ( 928 ) Amortization of Unrecognized Losses (Gains) 18 12 ( 214 ) ( 153 ) Net Periodic Benefit* $ ( 78 ) $ ( 274 ) $ ( 708 ) $ ( 566 ) * Service cost is included Operations and Maintenance expense on the consolidated statements of income; all other amounts are included in Other Income (Expense), net. Note 9 – Revenue Recognition from Contracts with Customers The Company’s revenues are primarily generated from regulated tariff-based water and wastewater utility services and non-regulated operation and maintenance contracts for services on water and wastewater systems owned by others. Revenue from contracts with customers is recognized when control of a promised good or service is transferred to customers at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods and services. The Company’s regulated revenue results from tariff-based water and wastewater services to residential, industrial, commercial, fire-protection and wholesale customers. Residential customers are billed monthly or quarterly while most industrial, commercial, fire-protection and wholesale customers are billed monthly. Payments by customers are due between 15 and 30 days after the invoice date. Revenue is recognized as the water and wastewater services are delivered to customers which includes an accrual of unbilled revenues estimated from the last meter reading date to the end of the accounting period utilizing factors such as historical customer data and regional weather indicators. Unearned Revenues 14 Table of Contents and Advance Service Fees include fixed service charge billings in advance to Tidewater customers recognized as service is provided to the customer. Non-regulated service contract revenues consist of base service fees, as well as fees for additional billable services provided to customers. Fees are billed monthly and are due within 30 days after the invoice date. The Company considers the amounts billed to represent the value of these services provided to customers. These contracts expire at various times through 2032 and contain remaining performance obligations for which the Company expects to recognize revenue in the future. These contracts also contain termination provisions. Substantially all of the amounts included in operating revenues and accounts receivable are from contracts with customers. The Company’s contracts do not contain any significant financing components. The Company’s operating revenues are comprised of the following: (In Thousands) Three Months Ended March 31, 2026 2025 Regulated Tariff Sales Residential $ 24,187 $ 23,114 Commercial 6,867 6,585 Industrial 3,602 2,999 Fire Protection 3,832 3,722 Wholesale 7,224 5,014 Non-Regulated Contract Operations 2,969 2,833 Total Revenue from Contracts with Customers $ 48,681 $ 44,267 Other Regulated Revenues 68 62 Other Non-Regulated Revenues 120 119 Inter-segment Elimination ( 155 ) ( 147 ) Total Revenue $ 48,714 $ 44,301 Note 10 – Income Taxes The Company’s effective tax rate was 10.8 % and 10.9 % for the three months ended March 31, 2026 and 2025 respectively. We evaluate and update our annual effective income tax rate on a quarterly basis based on current and forecasted operating results and tax laws. Income Taxes for the three months ended March 31, 2026 increased by $ 0.1 million from the same period in 2025, primarily due to higher pre-tax income. The statutory Federal tax rate is 21.0 % for each of the three months ended March 31, 2026 and 2025. For states with a corporate net income tax, the state corporate net income tax rates range from 8.7 % to 9.0 % for each of the three months ended March 31, 2026 and 2025. Our effective tax rate differs from the federal statutory tax rate primarily due to the recognition of the income tax benefits for the immediate deduction of repair expenditures on tangible property in the Middlesex System as well as other permanent book-to-tax differences. 15 Table of Contents Note 11 - Supplemental Cash Flows Information (In thousands) Three Months Ended March 31, 2026 2025 Utility Plant received as Construction Advances and Contributions $ 439 $ 1,500 Accrued Payables for Utility Plant 10,956 11,499 Conversion of Preferred Stock Into Common Stock 1 21 SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION: Cash Paid During the 3 Months for: Interest 3,194 3,365 Interest Capitalized 249 154 The cash flow impact of Tangible Property Repairs is reflected in Provision for Deferred Income Taxes and Investment Tax Credits in the Condensed Consolidated Statements of Cash Flows. 16 Table of Contents