Middlesex Water Company · NASDAQ:MSEX
Middlesex Water — Shareholder Meeting (May 2017)
49 slides from Middlesex Water's shareholder meeting presentation, May 24, 2017
Slide 1: Annual Meeting of Shareholders May 23, 2017
Annual Meeting of Shareholders May 23, 2017
Slide 2: 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 3: Looking Back at 2016
“Our employees continued to deliver for our customers and shareholders in 2016 through a number of operational improvements, enhanced service quality, a heightened focus on our asset management program and customer growth.” LOOKING BACK AT 2016
Slide 4: 2017 Milestone: Our 120th Year
Whoa! That’s a big number, aren’t you proud? 2017 MILESTONE: OUR 120 th YEAR
Slide 5: Our Suite of Services
OUR SUITE OF SERVICES Public Private Partnerships Renewable Energy Military Base Water Systems Contract Operations Industrial Applications Regulated Utility Ownership
Slide 6: America's Infrastructure Scores a D+
America’s Infrastructure Scores a D+ ASCE 2017 INFRASTRUCTUREREPORT CARD New Jersey DelawareNew Jersey Pennsylvania C D AMERICAN SOCIETY OF CIVIL ENGINEERS D-D Unavailable
Slide 7: Financial Highlights
FINANCIAL HIGHLIGHTS
Slide 8: Net Income ($Millions)
NET INCOME ($Millions) 14.4 16.6 18.5 20 22.7 0 5 10 15 20 25 2012 2013 2014 2015 2016
Slide 9: Earnings Per Share
EARNINGS PER SHARE $0.90 $1.03 $1.13 $1.22 $1.38 $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 2012 2013 2014 2015 2016
Slide 10: Revenues ($Millions)
REVENUES ($Millions) $110.00 $115.00 $117.10 $126.00 $132.90 $0.00 $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 $140.00 2012 2013 2014 2015 2016
Slide 11: Operating Revenues
OPERATING REVENUES 88% 12% Regulated Non Regulated Regulated Business: Water & wastewater customers in NJ, DE, and PA. Non-Regulated Contract Services: Operation & maintenance of water/wastewater systems in NJ, and DE.
Slide 12: Sources of Revenue (2016)
SOURCES OF REVENUE (2016) 48.30% 17.50% 9.80% 11.70% 11.00% 2.70% Residential Comm/Ind Fire Protection Contract Sales Contract Ops Other
Slide 13: Sources of Revenue (1991)
SOURCES OF REVENUE (1991) 38.90% 31.20% 12.60% 17.00% 0.20% Residential Comm/Ind Fire Protection Contract Sales Other
Slide 14: First Quarter 2017 Results
FIRST QUARTER 2017 RESULTS 2017 2016 Operating Revenues $30.1 $30.6 O & M Expenses $15.7 $15.8 Net income $4.4 $ 4.8 Diluted Earnings per Share $0.27 $0.29
Slide 15: Rate Activity
RATE ACTIVITY Effective Revenues Tidewater DSIC Jan. 2017 $0.3M Pinelands Water May 2016/17 $0.4M Pinelands WW May 2016 $0.1M Twin Lakes June 2016 $0.1M 15
Slide 16: Construction Program
$223 Million Estimated capital expenditures for years 2017-2019. CONSTRUCTION PROGRAM
Slide 17: Capital Expenditures
CAPITAL EXPENDITURES (Millions) 2017 2018 2019 Distribution Network $39 $50 $46 Production System 12 32 21 IT Systems 4 1 1 Other 5 6 6 Total $60 $89 $74
Slide 18: Utility Plant (Millions)
UTILITY PLANT (Millions) $385 $421 $472 $546 $610 $222 $233 $242 $257 $267 $0 $100 $200 $300 $400 $500 $600 $700 $800 $900 $1,000 2015 2016 2017 2018 2019 Delaware New Jersey 18
Slide 19: Funding
FUNDING Capital ▪ Cash Flow from Operations ▪ Dividend Reinvestment Plan Proceeds ▪ Short-term Lines of Credit ▪ Long-term Debt ▪ Common Stock Offering
Slide 20: 2017 Long-Term Debt
2017 LONG-TERM DEBT Qualified Projects Financed Under State Revolving Loan Programs Interest Rates Below Market 30 Year Final Maturity 2017 –New Jersey (3 Projects) Loan, $14.0 Million, Estimated @1.5%
Slide 21: Dividend Payout Ratio
DIVIDEND PAYOUT RATIO 83% 73% 68% 64% 0.00% 0.10% 0.20% 0.30% 0.40% 0.50% 0.60% 0.70% 0.80% 0.90% 2012 2013 2014 2015 2016 59%
Slide 22: Dividends
DIVIDENDS $0.74 $0.75 $0.76 $0.77 $0.80 $0.84 $0.68 $0.70 $0.72 $0.74 $0.76 $0.78 $0.80 $0.82 $0.84 $0.86 2012 2013 2014 2015 2016 2017 ▪ Cash dividends paid since 1912 ▪ 44 consecutive years of annual dividend rate increases
Slide 23: Operations Highlights
Whoa! That’s a big number, aren’t you proud? OPERATIONS HIGHLIGHTS
Slide 24: Drought Warning Lifted
October 2016 NJDEP Issues Drought Warning April 2017 NJDEP Lifts Drought Warning DROUGHT WARNING LIFTED
Slide 25: Recent Technical Innovation: Repairing a Leaking Main
Whoa! That’s a big number, aren’t you proud? RECENT TECHNICAL INNOVATION REPAIRING A LEAKING MAIN UNDERNEATH BUSY HIGHWAY
Slide 26: Carbon Fiber Pipeline Repair
Carbon Fiber Pipeline Repair UPGRADE OF 385 LINEAL FEET 30-inch wide pipeline Crews manually install the Carbon Fiber
Slide 27: Crews working inside the main
Crews working inside the main.
Slide 28: Better Reliability & Resiliency
BETTER RELIABILITY & RESILIENCY Middlesex Water Company is focused on upgrading water and wastewater infrastructure for current and future generations of customers.
Slide 29: Western Transmission Main
WESTERN TRANSMISSION MAIN 4.6 Mile Transmission Pipeline Provides Critical Reliability
Slide 30: RENEW 2016
RENEW 2016 ▪ $12.0 Million Project ▪ 8 Miles of Main ▪ Township of Edison and City of South Amboy Sample Customer Notice
Slide 31: Improving Fireflows & Service Quality
2017 ▪$10.0 Million Project ▪27,000 Feet of Mains ▪Borough of South Plainfield IMPROVING FIREFLOWS & SERVICE QUALITY
Slide 32: Meter Relocation Project
METER RELOCATION PROJECT
Slide 33: Elevated Storage Needs
ELEVATED STORAGE NEEDS Sites are being evaluated for three large water storage tanksto maintain adequate supply and enhanced fire protection during: xPeaks xDroughts xEmergencies Post Hurricane Sandy Action Item
Slide 34: Conversion to Ozone Treatment
Whoa! That’s a big number, aren’t you proud? CONVERSION TO OZONE TREATMENT ▪ Compliance with Anticipated Regulatory Requirements ▪ Prevents formation of THMs Renderings of Proposed Ozone Facility
Slide 35: Upgrades at Tingley Lane Wellfield
Station Booster UPGRADES AT TINGLEY LANE WELLFIELD ▪ Being upgraded to match current demands ▪ Helps ensure emergency back-up power
Slide 36: Field Safety Training
Estimated capital expenditures for years 2017-2019. FIELD SAFETY TRAINING MWC conducts frequent training including Cybersecurity Awareness Training
Slide 37: Tank Rehabilitation Program - DE
TANK REHABILITATION PROGRAM -DE 200,000 gallon Elevated Tank Serving the WoodfieldCommunity in Kent County
Slide 38: Capital Projects - Delaware
CAPITAL PROJECTS -DELAWARE
Slide 39: Growth
Whoa! That’s a big number, aren’t you proud? GROWTH
Slide 40: White Marsh Wins 5 Year O&M Contract
▪ 5 Year Operations and Maintenance Contract ▪ Assisting Lewes, DE Board of Public Works ▪ Will provide 24/7 operations and assist with capital planning and quality control WHITE MARSH WINS 5 YEAR O & M CONTRACT
Slide 41: Lewes Water Reclamation Facility
Whoa! That’s a big number, aren’t you proud? LEWES WATER RECLAMATION FACILITY
Slide 42: Delaware Customer Growth
DELAWARE CUSTOMER GROWTH 3,000 10,100 21,300 38,000 44,180 50,000 61,000 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 1992 1997 2002 2007 2012 2016 Build Out
Slide 43: Online E-billing
Online E-billing lets customers receive and pay bills electronically from their desktop, tablet or smart phone x Flexibility x Convenience x 24/7 Access
Slide 44: Emergency Home Repair Services
EMERGENCY HOME REPAIR SERVICES ▪ Water Line ▪ Sewer/Septic Line ▪ Interior Plumbing/Drainage ▪ Water Heater ▪ Combined Water/Sewer Line ▪ Heating System ▪ Cooling System 48,000 Contracts in Place 30,000 Customers
Slide 45: Supporting Our Communities
SUPPORTING OUR COMMUNITIES Employees volunteered at Ronald McDonald House in Wilmington, DE.
Slide 46: Educating the Public
EDUCATING THE PUBLIC
Slide 47: Honors
HONORS Leadership DE Young Professionals DE Operators of the Year General Counsel of the Year Finalist Delaware Top Workplaces –7 th Time Water/WW Professionals Team Award NYSE Governance Services Leadership Awards Finalist Rotary Honors Spotlight Award Top Ops Competition DTCC Scholarship
Slide 48: Saluting Our Retirees
SALUTING OUR RETIREES Water utilities face aging workforce challenges and are focused on recruiting, attracting and training a new generation of workers. Collectively 155+ years of Service Robert Capano Richard Cox Frank Falco Thomas Herholdt
Slide 49: Questions?
This presentation will be available on our Investor Relations Site at www.middlesexwater.com QUESTIONS? Thank you for your ongoing support!