Middlesex Water Company · NASDAQ:MSEX
Middlesex Water — Shareholder Meeting (May 2012)
53 slides from Middlesex Water's shareholder meeting presentation, May 23, 2012
Slide 1: 2012 Annual Meeting of Shareholders
2012 Annual Meeting of Shareholders May 22, 2012 J. Richard Tompkins Center Celebrating 115 Years!
Slide 2: Forward Looking Statement
Forward Looking Statement Certain matters discussed in this presentation are forward - looking statements intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995. These forward - looking statements can generally be identified as su
Slide 3: Financial Highlights
Financial Highlights ra i ee a es
Slide 4: Earnings per share 2007-2011
2007 2008 2009 2010 2011 $0.87 $0.89 $0.72 $0.96 $0.84
Slide 5: Operating revenues 2007-2011
2007 2008 2009 2010 2011 86.1 91 91.2 102.7 102.1
Slide 6: 2011 vs 2010 results
Operating Revenues $102.1 $102.7 Operating Expenses $ 77.9 $ 76.1 Net Income $ 13.4 $ 14.3 Diluted Earnings per Share $ 0.84 $ 0.96 Year Ended December 31, 2011 2010
Slide 7: Drivers of 2011 results
Weather - related consumption decline Lower demand from contract and residential customers Lower connection fees related to a stalled DE housing market
Slide 8: Challenges: water use trends, rate cycles, costs
Water Use Trends (Low flow appliances) Rate Cycles Ending in NJ and DE Operations and Maintenance Costs
Slide 9: First quarter 2012 results
Operating Revenues $23.5 $24.0 Operating Expenses $19.7 $19.2 Net Income $ 1.8 $ 2.6 Diluted Earnings per Share $ 0.11 $ 0.17 First Quarter Ended March 31, 2012 2011
Slide 10: Rate case status
• $0.1 Million Reached in December • $0.8 Million Rate Request filed in July • $6.9 Million Rate Request Filed in September • $0.4 Million PWAC Approved in August MWC TUI TLU TESI
Slide 11: Rate case status, pending decisions
• Settlement decision approved in March 2012 • Decision Expected in mid - 2012 • Decision Expected in mid - 2012 • $11.3 Million Rate Request filed in January MWC TUI TLU TESI
Slide 12: Utility plant growth by state
33.9 44.7 58.4 82.7 96.3 118.3 133.7 150.2 158.5 166.9 182.5 205.8 214.2 220.7 235.6 243.4 252.2 264.8 279.9 295 316.5 332.1 0 100 200 300 400 500 600 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 New Jersey Delaware
Slide 13: Capital funding
$8.9 $5.1 $4.0 $2.6 $1.2 Total - $21.8 Million
Slide 14: Funding sources
$1.2 $1.6 $3.5 $5.0 $ 10.5 Total Funding - $21.8
Slide 15: Regulated vs non-regulated business
90% 10% 0% 0% Regulated Business Non - Regulated Contract Services
Slide 16: Customers, regulated and non-regulated
18,000 20,000 20,000 23,000 24,000 27,000 31,000 35,000 39,000 39,000 40,000 48,000 78,000 82,000 86,000 87,000 89,000 92,000 94,000 98,000 99,000 100,000 100,000 103,000 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Non - R
Slide 17: Dividends paid since 1912
2011 2010 2009 2008 2007 $0.74 $0.73 $0.72 $0.71 $0.70 Q uarterly dividends paid since 1912 Increased dividends for 39 consecutive years Current Dividend Yield: 4.1%
Slide 18: Dividend and share price history
$0.25 $0.35 $0.45 $0.55 $0.65 $0.75 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11
Slide 19: Operating Highlights
Operating Highlights
Slide 20: Hurricane Irene Main Break
"Hurricane irene -Related:‘Main ‘Break :
Slide 21: Hurricane Irene Main Break After Repairs
Slide 22: Capital projects invested in 2011
▪ $23 Million invested in Capital Projects in 2011 ▪ Upgrades to treatment plants and distribution systems in DE ▪ RENEW Program in NJ
Slide 23: Major Pipeline Infrastructure Upgrades
Major Pipeline Infrastructure Upgrades
Slide 24: Year-of-upgrade program in Edison
• Year 16 of a 25 - Year Upgrade Program • $3.3 million investment to replace water mains, valves and fire hydrants • 37,000 feet of 6 - , 8 and 10 - inch main in the Township of Edison, NJ • Project funding by New Jersey Environmental Infrastructure Trust
Slide 25: Integrated ERP system
ERP AP Mobile Time & Labor CC & B Financials Human Resources Inventory Procurement Asset Mgmt. GIS Business processes across departments are integrated into a single system Helps Reduce Operating Costs, Facilitates Day - to - Day Management, Supports Planning
Slide 26: ERP implementation and training
Integration of all modules required extensive employee training Over the 4 - year implementation of all modules, every employee involved in the project continued to perform their current job responsibilities Last core module went live May 21 next week
Slide 27: Mobile GIS technology in the field
Slide 28: Crew location and customer response
Knowing the location of our crews enables field personnel to respond to customer inquiries in a more timely and efficient manner
Slide 29: Visibility into fleet locations
Visibility into Fleet Locations Technology allows real - time access to system - wide water main, valve and hydrant data via user - friendly maps
Slide 30: Dispatching across state lines
Dispatching has transparency across state lines
Slide 31: Enhancing Service
_.EnhancingSen ot ustol Full
Slide 32: Strategy for Shareholder Value
Strategy for Shareholder Value Y Seek organic customer growth and utility infrastructure growth Y Pursue acquisitions at reasonable prices Y Continue Regulated and Non-regulated business and contracts Y Consider complementary products and services v Prudently invest in regulated utility infrastructu
Slide 33: Accomplishments and expanded capabilities
Expanded Service Area Stronger Infrastructure Greater Efficiency Better Trained Workforce Complementary Business Line More Strategic Partnerships Expanded Communication Toolkit Optional Repair Plan Offerings Strong Corporate Citizenship
Slide 34: Ownership/Operation of Assets Public/Private Partnerships
Ownership/Operation of Assets Public/Private Partnerships
Slide 35: HomeServe USA LineCare marketing agreement
2000 7000 12000 17000 22000 27000 Apr - 11 May - 11 Jun - 11 Jul - 11 Aug - 11 Sep - 11 Oct - 11 Nov - 11 Dec - 11 Jan - 12 Feb - 12 Mar - 12 Apr - 12 Total Active Contracts Total Active Households 10 - Year Marketing Agreement with Home Serve USA, a leading provider of home maintenance service prog
Slide 36: Ongoing Maintenance
Ongoing Maintenance
Slide 37: TESI Adds Wastewater Facility
TESI Adds Wastewater Facility ▪ TESI’s seventh wastewater treatment facility ▪ Serves a 75 - lot development in Lewes, DE Serving The Ridings Community
Slide 38: Regional wastewater plant update
andend ae Update = TUI seeks to build a regional wastewater treatment and disposal : plant. ™ Status: Construction permit has been issued
Slide 39: Southern DE Operations Center
Southern DE Operations Center Facility allows for: t') ¥ Centralized Inventory =| ¥ Enhanced dispatching, capabilities v More efficient Tesponse to customers in Southern Delaware
Slide 40: Avalon, NJ
Slide 41: 10-Year Management Contract with Avalon, NJ
10-Year Management Contract with Avalon, NJ = Utility Service Affiliates (USA) will operate and manage the Borough's water, wastewater and storm water collection: systems, = Contract runs July 1, 2012 through June 2022 = Work includes: billing operations, customer service issues, meter installations
Slide 42: Agreement with Sunoco Logistics
Agreement with Sunoco Logistics > USA has entered a one year agreement to operate the Eagle Point Biological Wastewater Treatment Facility in Westville, NJ > USA responsible for daily operation of the industrial wastewater treatment facility > USA assumed system operation in Qi 2012
Slide 43: There's no such thing as waste water
There’s no such thing as waste water! Water Energy Nutrients Metals
Slide 44: Ridgewood Green joint venture
MSEX and Natural Systems Utilities formed a joint venture 20 - year public private partnership with the Village of Ridgewood, New Jersey Ridgewood Green will d esign, build, own and operate facilities to optimize production of electricity at Ridgewood’s municipal wastewater treatment plant Facility
Slide 45: Energy recovery from wastewater
Many technologies are able to recover energy (Wastewater effluent to Sustainable and environ- mentally friendly approach
Slide 46: Approach to Treatment Process Optimization
Conversion of biogas to electricity via anaerobic digestion Installation of solar arrays to produce additional electricity Addition of ultraviolet light for wastewater disinfection Approach to Treatment Process Optimization
Slide 47: Skills Development Training
Skills Development Training for Supervisory/Management Staff □ Setting the Stage for Excellent Performance □ Communicating for Results □ Building Effective Work Relationships □ Coaching for Optimal Performance □ Building a Positive Work Environment □ Developing Employee Skills and Work Habits □ Mana
Slide 48: Honors and Awards
Honors and Awards
Slide 49: Serving Our Communities
Serving Our Communities
Slide 50: Communicating The Value of Water
Communicating The Value of Water
Slide 51: Executive Leadership Changes
Executive Leadership Changes James Garrett Retired in March 2012 Lorrie Ginegaw Named Vice President – Human Resources
Slide 52: Our Values
Our Values: Integrity A Strong Customer Focus Continual Improvement Teamwork Social Responsibility A Results - Driven Work Ethic
Slide 53: 2012 Annual Meeting of Shareholders - Thank you
2012 Annual Meeting of Shareholders Thank you for your continued interest and support! Celebrating 115 Years!