Middlesex Water Company · NASDAQ:MSEX
Middlesex Water — Shareholder Meeting (May 2024)
22 slides from Middlesex Water's shareholder meeting presentation, May 22, 2024
Slide 1: Annual Meeting of Shareholders May 21, 2024
ANNUAL MEETING OF SHAREHOLDERS NASDAQ:MSEX MAY 21, 2024
Slide 2: Our Speakers
Dennis W. Doll Chairman of the Board Nadine Leslie President & CEO A. Bruce O’Connor Sr. Vice President, Treasurer & CFO Our Speakers Jay L. Kooper Vice President, General Counsel & Secretary Robert J. Capko Principal Accounting Officer 2 2
Slide 3: Forward Looking Statement
Forward Looking Statement As an introduction to the information we will be discussing, please be aware that some of our comments can be considered forward looking statements as defined by the federal securities laws and as outlined in the Company’s SEC filings. As such, any forward looking statement
Slide 4: Company Snapshot
Company Snapshot MSEX operates regulated water and wastewater operations in New Jersey and Delaware. It also operates water and wastewater systems under contract for municipalities and private clients. • Established: 1897 • Market Capitalization: $1.0B • Diluted EPS: $2.02 TTM • Average Trading Volu
Slide 5: Looking Back - Key Highlights
• March 2024 - Nadine Leslie became President and CEO and named to the Middlesex Board of Directors. Dennis Doll retired February 2024. Doll remains Chairman of the Board through the expiration of his term. • December 2023 – Bruce Patrick, P.E. Named President of Tidewater Utilities, Inc. • July 202
Slide 6: Treatment Plant and Infrastructure Upgrades
Treatment Plant and Infrastructure Upgrades Replacement of main motor control center and electrical distribution equipment at the Company’s largest surface water treatment plant Treatment upgrades including chemical feed improvements, residual removal equipment, pumps, surge mitigation at the Park A
Slide 7: Distribution System Improvements
Distribution System Improvements $10.2M investment Replacement of 17,200 linear feet of cast iron main in Carteret and Port Reading, NJ in 2023 Installation of exterior below ground meter pits to support eventual meter relocation from inside home to exterior Replacement of valves, fire hydrants and
Slide 8: Recent Developments: Dividend, PFAS Rules, Base Rate Increase
• April 2024 - MWC declared a cash dividend of $0.325 per share on its common stock payable June 3, 2024 to shareholders of record as of May 15, 2024. • April 2024 – MWC announces strategy is in place to comply with new, more stringent USEPA regulations which set a Maximum Contaminant Level for PFOS
Slide 9: Delaware Update
• Tidewater Utilities observing 60 years of service to Delaware residents. • 59,000 Customers in over 470 separate communities. • Bruce Patrick, P.E. Named President of Tidewater Utilities in November 2023. • Organic residential customer growth continues in our Tidewater system (approximately 4% in
Slide 10: Our Digital Transformation Journey
Our Digital Transformation Journey • Enterprise Resource Planning System being upgraded to the Cloud • $4.4 million Initiative called Project Synergy • Marks continual progress in our digital transformation journey • 12-month implementation period with estimated go live Q2 2025 • Project Kick-off Ap
Slide 11: Emergency Preparedness and Protecting Critical Networks
Emergency Preparedness Protecting Critical Networks and Operations • Company wide Tabletop Exercises to Test Plans and Emergency Response • Face to Face meetings with Local and State Emergency Officials • New Roles Added to Support Enhanced Safety, Security & Emergency Preparedness • Facility Tours
Slide 12: 2023 Financial Results
2023 2022 Operating Revenues $ 166.3M $ 162.4M O&M Expenses $ 83.1M $ 79.1M Gain on Sale of Subsidiary $ --- $ 5.2M Interest Charges $ 13.1M $ 9.4M Net Income $ 31.5M $ 42.4M Earnings Per Share $ 1.76 $ 2.39 2023 Financial Results 12
Slide 13: First Quarter 2024 Results
2024 2023 Operating Revenues $ 40.5M $ 38.2M O&M Expenses $ 20.5M $ 20.3M Net Income $ 10.7M $ 5.9M Earnings Per Share $ 0.59 $ 0.33 First Quarter 2024 Results 13
Slide 14: Utility Plant
Utility Plant (Millions) $696 $744 $810 $874 $932 $276 $298 $323 $358 $378 $- $200 $400 $600 $800 $1,000 $1,200 $1,400 2020 2021 2022 2023 2024E New Jersey Delaware 14
Slide 15: Number of Customers and 2023 Revenues by Customer Type
Number of Customers 65,800 65,900 66,010 66,060 66,110 55,280 57,760 60,070 62,400 64,780 - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 2021 2022 2023 2024E 2025E New Jersey Delaware 2023 Revenues By Customer Type Residential: 52.1% Commercial: 14.4% Contract Sales: 11.5% Fire Protection: 7.
Slide 16: Planned Capital Investment
2024 2025 2026 2024-2026 Distribution/Network System $ 42M $ 53M $ 50M $ 145M Production System $ 26M $ 18M $ 11M $ 55M Information Technology (IT) Systems $ 4M $ 2M $ 3M $ 9M Other $ 6M $ 6M $ 6M $ 18M Total Estimated Capital Expenditures $ 78M $ 79M $ 70M $ 227M Planned Capital Investment Capital
Slide 17: Dividends Paid
Dividends Paid $0.98 $1.04 $1.11 $1.18 $1.26 $- $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 2019 2020 2021 2022 2023 In Q4, 2023 the Board of Directors increased the dividend by 4.0%. 17
Slide 18: Diluted EPS & Dividend Payout Ratio
DILUTED EPS & $2.01 $2.18 $2.07 $2.39 $1.76 49% 48% 54% 49% 72% 0% 10% 20% 30% 40% 50% 60% 70% 80% $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 2019 2020 2021 2022 2023 Dividend Payout Ratio Diluted Earnings Per Share Diluted Earnings Per Share Dividend Payout Ratio PAYOUT RATIO 18
Slide 19: Governance Update
Governance Update • Appointment of Nadine Leslie as President/CEO. • Former President Mr. Doll will remain Chairman of the Middlesex Board of Directors through the expiration of his current term to ensure seamless transition. • Corporate Governance & Nominating Committee of the Board oversees Cybers
Slide 20: Sustainability Strategy
Sustainability Strategy Being environmental stewards and ensuring compliance with all State and Federal environmental laws & regulations Protecting the health, wellbeing and safety of our employees and communities by providing safe and reliable water service Fostering accountability through a sound
Slide 21: Supporting Our Communities
Supporting Our Communities Presenting at Industry Conferences Tours Community & Industry Events Volunteer Efforts Career Days Donations Bowl for Hunger 21
Slide 22: Thank You
THANK YOU MiddlesexWater.com CONTACT US info@middlesexwater.com 22