MIDDLESEX WATER CO - 10-Q Quarterly Report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 10-Q

(Mark One)
	\|X\|	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2004

OR

	\|_\|	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________________ to______________________

Commission File Number 0-422

MIDDLESEX WATER COMPANY
(Exact name of registrant as specified in its charter)

New Jersey		22-1114430
(State of incorporation)		(IRS employer identification no.)

1500 Ronson Road, Iselin NJ 08830
(Address of principal executive offices, including zip code)

(732) 634-1500
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes |X| No |_|

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act):

Yes |X| No |_|

The number of shares outstanding of each of the registrant’s classes of common stock, as of October 29, 2004: Common Stock, No Par Value: 11,344,172 shares outstanding.

INDEX

		PAGE

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements:

	Condensed Consolidated Statements of Income		1

	Condensed Consolidated Balance Sheets		2

	Condensed Consolidated Statement of Cash Flows		3

	Condensed Consolidated Statements of Capital Stock and Long-term Debt		4

	Condensed Consolidated Statements of Comprehensive Income		5

	Notes to Condensed Consolidated Financial Statements		6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		13

Item 3.	Quantitative and Qualitative Disclosures of Market Risk		20

Item 4.	Controls and Procedures		20

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings		20

Item 2.	Changes in Securities		20

Item 3.	Defaults upon Senior Securities		20

Item 4.	Submission of Matters to a Vote of Security Holders		21

Item 5.	Other Information		21

Item 6.	Exhibits		21

SIGNATURE			21

M IDDLESEX WATER COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

				Three Months Ended September 30,						Nine Months Ended September 30,						Twelve Months Ended September 30,
				2004			2003			2004			2003			2004			2003


Operating Revenues				$	19,856,688		$	17,585,575		$	53,502,334		$	48,564,914		$	69,048,634		$	63,759,946


Operating Expenses:
	Operations				9,193,804			8,687,828			27,455,475			24,292,699			35,828,875			31,478,131
	Maintenance				759,352			830,877			2,430,319			2,612,556			3,346,876			3,457,835
	Depreciation				1,467,523			1,342,059			4,353,222			3,960,856			5,755,093			5,242,946
	Other Taxes				2,224,028			2,081,210			6,195,329			5,950,472			8,060,775			7,854,295
	Income Taxes				1,714,802			1,143,264			3,240,804			2,764,542			3,713,480			3,592,126


		Total Operating Expenses			15,359,509			14,085,238			43,675,149			39,581,125			56,705,099			51,625,333


			Operating Income		4,497,179			3,500,337			9,827,185			8,983,789			12,343,535			12,134,613

Other Income:
	Allowance for Funds Used During Construction				179,173			95,448			309,455			253,253			372,121			336,482
	Other Income				33,418			41,705			170,983			83,896			218,586			199,144
	Other Expense				(85	)		(984	)		(29,761	)		(68,708	)		(50,984	)		(122,367	)


		Total Other Income, net			212,506			136,169			450,677			268,441			539,723			413,259

Interest Charges					1,347,475			1,243,888			3,991,681			3,830,926			5,387,785			5,099,090


Net Income					3,362,210			2,392,618			6,286,181			5,421,304			7,495,473			7,448,782

Preferred Stock Dividend Requirements					63,697			63,697			191,090			191,090			254,786			254,786


Earnings Applicable to Common Stock				$	3,298,513		$	2,328,921		$	6,095,091		$	5,230,214		$	7,240,687		$	7,193,996


Earnings per share of Common Stock:
	Basic			$	0.29		$	0.22		$	0.55		$	0.50		$	0.67		$	0.69
	Diluted			$	0.29		$	0.22		$	0.55		$	0.50		$	0.66		$	0.68

Average Number of
	Common Shares Outstanding :
	Basic				11,316,768			10,505,517			10,989,209			10,448,226			10,880,220			10,472,573
	Diluted				11,659,908			10,848,657			11,332,349			10,791,366			11,223,360			10,815,713

Cash Dividends Paid per Common Share				$	0.1650		$	0.1613		$	0.4950		$	0.4839		$	0.6600		$	0.6452

See Notes to Condensed Consolidated Financial Statements.

MIDDLESEX WATER COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

		September 30, 2004		December 31, 2003

ASSETS

UTILITY PLANT:	Water Production	$	79,388,120	$	77,265,782
	Transmission and Distribution		178,501,289		174,455,437
	General		20,061,010		19,776,293
	Construction Work in Progress		16,517,777		2,798,070

	TOTAL		294,468,196		274,295,582
	Less Accumulated Depreciation		50,782,036		47,510,797

	UTILITY PLANT - NET		243,686,160		226,784,785

	NONUTILITY ASSETS - NET		4,337,165		4,147,685

CURRENT ASSETS:	Cash and Cash Equivalents		2,601,686		3,005,610
	Accounts Receivable		7,180,976		5,682,608
	Unbilled Revenues		4,124,599		3,234,788
	Materials and Supplies (at average cost)		1,594,800		1,419,142
	Prepayments		1,035,892		1,009,304

	TOTAL CURRENT ASSETS		16,537,953		14,351,452

DEFERRED CHARGES AND OTHER ASSETS:	Unamortized Debt Expense		3,166,448		3,272,783
DEFERRED CHARGES AND OTHER ASSETS:	Preliminary Survey and Investigation Charges		882,065		1,380,771
	Regulatory Assets		8,655,119		8,216,117
	Operations Contracts Fees Receivable		699,806		699,806
	Restricted Cash		1,437,163		3,825,420