UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

þ	~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~March 31,~~June 30, 2012

£	~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

¨ 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

(State of incorporation)

22-1114430

(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.

Yesþ No¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or such shorter period that the registrant was required to submit and post files).

Yesþ No¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.

Large accelerated filer¨ Accelerated filerþ Non-accelerated filer¨ Smaller reporting company¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes¨ Noþ

The number of shares outstanding of each of the registrant's classes of common stock, as of ~~May 4,~~July 31, 2012: Common Stock, No Par Value: ~~15,710,293~~15,733,286 shares outstanding.

INDEX

PART I.	FINANCIAL INFORMATION	PAGE

Item 1.	Financial ~~Statements:~~Statements (Unaudited):

	Condensed Consolidated Statements of Income	1

	Condensed Consolidated Balance Sheets	2

	Condensed Consolidated Statements of Cash Flows	3

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

	Notes to Unaudited Condensed Consolidated Financial Statements	5

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	1113

Item 3.	Quantitative and Qualitative Disclosures of Market Risk	1721

Item 4.	Controls and Procedures	1822

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	1923

Item 1A.	Risk Factors	1923

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	1923

Item 3.	Defaults upon Senior Securities	1923

Item 4.	Mine Safety Disclosures	1923

Item 5.	Other Information	1923

Item 6.	Exhibits	1923

SIGNATURES		2024

Index

MIDDLESEX WATER COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands except per share amounts)

Three Months Ended March 31,
2012 2011

Operating Revenues $ 23,546 $ 23,996

Operating Expenses:
Operations and Maintenance 14,375 14,031
Depreciation 2,548 2,412
Other Taxes 2,746 2,785

Total Operating Expenses 19,669 19,228

Operating Income 3,877 4,768

Other Income (Expense):
Allowance for Funds Used During Construction 136 194
Other Income 192 157
Other Expense (140 ) (49 )

Total Other Income, net 188 302

Interest Charges 1,354 1,214

Income before Income Taxes 2,711 3,856

Income Taxes 904 1,226

Net Income 1,807 2,630

Preferred Stock Dividend Requirements 52 52 ��

Earnings Applicable to Common Stock $ 1,755 $ 2,578

Earnings per share of Common Stock:
Basic $ 0.11 $ 0.17
Diluted $ 0.11 $ 0.17

Average Number of Common Shares Outstanding:
Basic 15,692 15,576
Diluted 15,955 15,839

Cash Dividends Paid per Common Share $ 0.1850 $ 0.1825

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011

Operating Revenues	$	27,401		$	26,102		$	50,947		$	50,098

Operating Expenses:
Operations and Maintenance		14,765			14,062			29,140			28,093
Depreciation		2,582			2,417			5,130			4,829
Other Taxes		2,844			2,885			5,590			5,670

Total Operating Expenses		20,191			19,364			39,860			38,592

Operating Income		7,210			6,738			11,087			11,506

Other Income (Expense):
Allowance for Funds Used During Construction		137			197			273			391
Other Income		125			202			317			359
Other Expense		(11	)		(111	)		(151	)		(160	)

Total Other Income, net		251			288			439			590

Interest Charges		1,779			1,714			3,133			2,928

Income before Income Taxes		5,682			5,312			8,393			9,168

Income Taxes		1,957			1,687			2,861			2,913

Net Income		3,725			3,625			5,532			6,255

Preferred Stock Dividend Requirements		51			51			103			103

Earnings Applicable to Common Stock	$	3,674		$	3,574		$	5,429		$	6,152

Earnings per share of Common Stock:
Basic	$	0.23		$	0.23		$	0.35		$	0.40
Diluted	$	0.23		$	0.23		$	0.35		$	0.40

Average Number of
Common Shares Outstanding :
Basic		15,716			15,598			15,704			15,587
Diluted		15,979			15,861			15,967			15,850

Cash Dividends Paid per Common Share	$	0.1850		$	0.1825		$	0.3700		$	0.3650

See Notes to Condensed Consolidated Financial ~~Statements~~Statements.

Index

MIDDLESEX WATER COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)

		June 30,		December 31,
ASSETS		2012		2011
UTILITY PLANT:	Water Production	$	129,118	$	127,827
	Transmission and Distribution		332,715		326,629
	General		54,035		47,519
	Construction Work in Progress		9,940		12,575
	TOTAL		525,808		514,550
	Less Accumulated Depreciation		95,832		92,351
	UTILITY PLANT - NET		429,976		422,199

CURRENT ASSETS:	Cash and Cash Equivalents		2,727		3,106
	Accounts Receivable, net		10,232		11,280
	Unbilled Revenues		6,193		4,842
	Materials and Supplies (at average cost)		2,041		2,023
	Prepayments		2,242		1,622
	TOTAL CURRENT ASSETS		23,435		22,873

DEFERRED CHARGES	Unamortized Debt Expense		2,550		2,611
AND OTHER ASSETS:	Preliminary Survey and Investigation Charges		5,157		5,179
	Regulatory Assets		66,338		67,302
	Operations and Developer Contracts Receivable		2,147		5,300
	Restricted Cash		5,838		3,260
	Non-utility Assets - Net		9,106		8,182
	Other		594		630
	TOTAL DEFERRED CHARGES AND OTHER ASSETS		91,730		92,464
	TOTAL ASSETS	$	545,141	$	537,536

CAPITALIZATION AND LIABILITIES
CAPITALIZATION:	Common Stock, No Par Value	$	142,592	$	141,432
	Retained Earnings		35,168		35,549
	TOTAL COMMON EQUITY		177,760		176,981
	Preferred Stock		3,353		3,353
	Long-term Debt		135,079		132,167
	TOTAL CAPITALIZATION		316,192		312,501

CURRENT	Current Portion of Long-term Debt		4,996		4,569
LIABILITIES:	Notes Payable		25,250		24,250
	Accounts Payable		4,797		5,706
	Accrued Taxes		9,252		7,847
	Accrued Interest		1,622		1,628
	Unearned Revenues and Advanced Service Fees		743		734
	Other		1,875		1,953
	TOTAL CURRENT LIABILITIES		48,535		46,687

COMMITMENTS AND CONTINGENT LIABILITIES (Note 7)

DEFERRED CREDITS	Customer Advances for Construction		21,707		21,944
AND OTHER LIABILITIES:	Accumulated Deferred Investment Tax Credits		1,107		1,146
	Accumulated Deferred Income Taxes		37,753		37,022
	Employee Benefit Plans		51,304		51,006
	Regulatory Liability - Cost of Utility Plant Removal		8,405		8,029
	Other		974		995
	TOTAL DEFERRED CREDITS AND OTHER LIABILITIES		121,250		120,142

CONTRIBUTIONS IN AID OF CONSTRUCTION			59,164		58,206
	TOTAL CAPITALIZATION AND LIABILITIES	$	545,141	$	537,536

March 31, December 31,
ASSETS    2012 2011
UTILITY PLANT: Water Production $ 128,324 $ 127,827
Transmission and Distribution 329,224 326,629
General 48,067 47,519
Construction Work in Progress 14,040 12,575
TOTAL 519,655 514,550
Less Accumulated Depreciation 93,740 92,351
UTILITY PLANT - NET 425,915 422,199

CURRENT ASSETS: Cash and Cash Equivalents 854 3,106
Accounts Receivable, net 10,628 11,280
Unbilled Revenues 4,587 4,842
Materials and Supplies (at average cost) 2,003 2,023
Prepayments 1,121 1,622
TOTAL CURRENT ASSETS 19,193 22,873

DEFERRED CHARGES Unamortized Debt Expense 2,570 2,611
AND OTHER ASSETS: Preliminary Survey and Investigation Charges 5,088 5,179
Regulatory Assets 66,760 67,302
Operations Contracts and Developer Fees Receivable 4,957 5,300
Restricted Cash 2,518 3,260
Non-utility Assets - Net 8,485 8,182
Other 647 630
TOTAL DEFERRED CHARGES AND OTHER ASSETS 91,025 92,464
TOTAL ASSETS $ 536,133 $ 537,536

CAPITALIZATION AND LIABILITIES
CAPITALIZATION: Common Stock, No Par Value $ 142,008 $ 141,432
Retained Earnings 34,399 35,549
TOTAL COMMON EQUITY 176,407 176,981
Preferred Stock 3,353 3,353
Long-term Debt 131,729 132,167
TOTAL CAPITALIZATION 311,489 312,501

CURRENT Current Portion of Long-term Debt 4,739 4,569
LIABILITIES: Notes Payable 23,250 24,250
Accounts Payable 4,826 5,706
Accrued Taxes 10,144 7,847
Accrued Interest 906 1,628
Unearned Revenues and Advanced Service Fees 684 734
Other 1,400 1,953
TOTAL CURRENT LIABILITIES 45,949 46,687

COMMITMENTS AND CONTINGENT LIABILITIES (Note 7)

DEFERRED CREDITS Customer Advances for Construction 21,903 21,944
AND OTHER LIABILITIES: Accumulated Deferred Investment Tax Credits 1,127 1,146
Accumulated Deferred Income Taxes 37,421 37,022
Employee Benefit Plans 50,372 51,007
Regulatory Liability - Cost of Utility Plant Removal 8,217 8,029
Other 997 994
TOTAL DEFERRED CREDITS AND OTHER LIABILITIES 120,037 120,142

CONTRIBUTIONS IN AID OF CONSTRUCTION    58,658 58,206
TOTAL CAPITALIZATION AND LIABILITIES $ 536,133 $ 537,536

See Notes to Condensed Consolidated Financial ~~Statements~~ Statements.

Index

Three Months Ended March 31,
2012 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 1,807 $ 2,630
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Depreciation and Amortization 2,620 2,584
Provision for Deferred Income Taxes and Investment Tax Credits 514 208
Equity Portion of Allowance for Funds Used During Construction (AFUDC) (82 ) (132 )
Cash Surrender Value of Life Insurance (68 ) (45 )
Stock Compensation Expense 174 82
Changes in Assets and Liabilities:
Accounts Receivable 995 1,923
Unbilled Revenues 255 196
Materials & Supplies 20 673
Prepayments 501 (123 )
Accounts Payable (880 ) (1,233 )
Accrued Taxes 2,297 2,411
Accrued Interest (722 ) (760 )
Employee Benefit Plans 100 154
Unearned Revenue & Advanced Service Fees (50 ) 30
Other Assets and Liabilities (334 ) (540 )

NET CASH PROVIDED BY OPERATING ACTIVITIES 7,147 8,058
CASH FLOWS FROM INVESTING ACTIVITIES:
Utility Plant Expenditures, Including AFUDC of $54 in 2012, $62 in 2011 (6,433 ) (4,888 )
Restricted Cash 742 852

NET CASH USED IN INVESTING ACTIVITIES (5,691 ) (4,036 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Redemption of Long-term Debt (844 ) (828 )
Proceeds from Issuance of Long-term Debt 576 7
Net Short-term Bank Borrowings (1,000 ) 800
Deferred Debt Issuance Expense — (19 )
Repurchase of Preferred Stock — (9 )
Proceeds from Issuance of Common Stock 402 386
Payment of Common Dividends (2,902 ) (2,842 )
Payment of Preferred Dividends (52 ) (52 )
Construction Advances and Contributions-Net 112 (122 )

NET CASH USED IN FINANCING ACTIVITIES (3,708 ) (2,679 )
NET CHANGES IN CASH AND CASH EQUIVALENTS (2,252 ) 1,343
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 3,106 2,453
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 854 $ 3,796

SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITY:
Utility Plant received as Construction Advances and Contributions $ 298 $ 508

SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION:
Cash Paid During the Year for:
Interest $ 2,187 $ 2,088
Interest Capitalized $ 54 $ 62
Income Taxes $ — $ 603

	Six Months Ended June 30,
	2012			2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	5,532		$	6,255
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Depreciation and Amortization		5,489			5,174
Provision for Deferred Income Taxes and Investment Tax Credits		990			422
Equity Portion of Allowance for Funds Used During Construction (AFUDC)		(170	)		(260	)
Cash Surrender Value of Life Insurance		(90	)		(86	)
Stock Compensation Expense		372			234
Changes in Assets and Liabilities:
Accounts Receivable		4,201			1,827
Unbilled Revenues		(1,351	)		(1,567	)
Materials & Supplies		(18	)		247
Prepayments		(620	)		(836	)
Accounts Payable		(909	)		(699	)
Accrued Taxes		1,405			485
Accrued Interest		(6	)		82
Employee Benefit Plans		1,846			891
Unearned Revenue & Advanced Service Fees		9			2
Other Assets and Liabilities		(867	)		(87	)

NET CASH PROVIDED BY OPERATING ACTIVITIES		15,813			12,084
CASH FLOWS FROM INVESTING ACTIVITIES:
Utility Plant Expenditures, Including AFUDC of $103 in 2012, $131 in 2011		(12,574	)		(11,039	)
Restricted Cash		(2,578	)		1,145
Investment in Joint Venture		(500	)		—

NET CASH USED IN INVESTING ACTIVITIES		(15,652	)		(9,894	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Redemption of Long-term Debt		(1,590	)		(1,434	)
Proceeds from Issuance of Long-term Debt		4,929			2,315
Net Short-term Bank Borrowings		1,000			3,250
Deferred Debt Issuance Expense		(22	)		(19	)
Repurchase of Preferred Stock		—			(9	)
Proceeds from Issuance of Common Stock		788			775
Payment of Common Dividends		(5,809	)		(5,688	)
Payment of Preferred Dividends		(103	)		(103	)
Construction Advances and Contributions-Net		267			553

NET CASH USED IN FINANCING ACTIVITIES		(540	)		(360	)
NET CHANGES IN CASH AND CASH EQUIVALENTS		(379	)		1,830
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		3,106			2,453
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	2,727		$	4,283


SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITY:
Utility Plant received as Construction Advances and Contributions	$	453		$	6,288

SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION:
Cash Paid During the Year for:
Interest	$	3,208		$	2,918
Interest Capitalized	$	103		$	131
Income Taxes	$	774		$	2,550

See Notes to Condensed Consolidated Financial ~~Statements~~Statements.

Index

MIDDLESEX WATER COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CAPITAL STOCK
AND LONG-TERM DEBT
(Unaudited)
(In thousands)

March 31, December 31,
2012 2011
Common Stock, No Par Value
Shares Authorized - 40,000
Shares Outstanding - 2012 - 15,703 $ 142,008 $ 141,432
2011 - 15,682

Retained Earnings 34,399 35,549
TOTAL COMMON EQUITY $ 176,407 $ 176,981

Cumulative Preferred Stock, No Par Value:
Shares Authorized - 134
Shares Outstanding - 32
  Convertible:
Shares Outstanding, $7.00 Series - 14 1,457 1,457
Shares Outstanding, $8.00 Series -   7 816 816
  Nonredeemable:
Shares Outstanding, $7.00 Series - 1 80 80
Shares Outstanding, $4.75 Series - 10 1,000 1,000
TOTAL PREFERRED STOCK $ 3,353 $ 3,353

Long-term Debt:
  8.05%, Amortizing Secured Note, due December 20, 2021 $ 2,282 $ 2,319
  6.25%, Amortizing Secured Note, due May 19, 2028 6,790 6,895
  6.44%, Amortizing Secured Note, due August 25, 2030 5,157 5,227
  6.46%, Amortizing Secured Note, due September 19, 2031 5,437 5,507
  4.22%, State Revolving Trust Note, due December 31, 2022 546 546
  3.30% to 3.60%, State Revolving Trust Note, due May 1, 2025 3,607 3,623
  3.49%, State Revolving Trust Note, due January 25, 2027 618 633
  4.03%, State Revolving Trust Note, due December 1, 2026 825 825
  4.00% to 5.00%, State Revolving Trust Bond, due August 1, 2021 434 434
  0.00%, State Revolving Fund Bond, due August 1, 2021 352 359
  3.64%, State Revolving Trust Note, due July 1, 2028 364 364
  3.64%, State Revolving Trust Note, due January 1, 2028 122 122
  3.45%, State Revolving Trust Note, due August 1, 2031 45 39
  6.59%, Amortizing Secured Note, due April 20, 2029 5,959 6,046
  7.05%, Amortizing Secured Note, due January 20, 2030 4,458 4,521
  5.69%, Amortizing Secured Note, due January 20, 2030 9,145 9,273
  3.75%, State Revolving Trust Note, due July 1, 2031 2,580 2,021
  3.75%, State Revolving Trust Note, due November 30, 2030 1,415 1,404
  First Mortgage Bonds:
5.20%, Series S, due October 1, 2022 12,000 12,000
5.25%, Series T, due October 1, 2023 6,500 6,500
5.25%, Series V, due February 1, 2029 10,000 10,000
5.35%, Series W, due February 1, 2038 23,000 23,000
0.00%, Series X, due September 1, 2018 368 375
4.25% to 4.63%, Series Y, due September 1, 2018 410 410
0.00%, Series Z, due September 1, 2019 876 894
5.25% to 5.75%, Series AA, due September 1, 2019 1,080 1,080
0.00%, Series BB, due September 1, 2021 1,183 1,206
4.00% to 5.00%, Series CC, due September 1, 2021 1,400 1,400
5.10%, Series DD, due January 1, 2032 6,000 6,000
0.00%, Series EE, due August 1, 2023 4,709 4,804
3.00% to 5.50%, Series FF, due August 1, 2024 6,160 6,160
0.00%, Series GG, due August 1, 2026 1,330 1,352
4.00% to 5.00%, Series HH, due August 1, 2026 1,640 1,640
0.00%, Series II, due August 1, 2024 1,128 1,150
3.40% to 5.00%, Series JJ, due August 1, 2027 1,560 1,560
0.00%, Series KK, due August 1, 2028 1,500 1,526
5.00% to 5.50%, Series LL, due August 1, 2028 1,635 1,635
0.00%, Series MM, due August 1, 2030 1,868 1,901
3.00% to 4.375%, Series NN, due August 1, 2030 1,985 1,985
SUBTOTAL LONG-TERM DEBT 136,468 136,736
Less: Current Portion of Long-term Debt (4,739 ) (4,569 )
TOTAL LONG-TERM DEBT $ 131,729 $ 132,167

		June 30,			December 31,
		2012			2011
Common Stock, No Par Value
Shares Authorized -	40,000
Shares Outstanding -	2012 - 15,730	$	142,592		$	141,432
	2011 - 15,682
Retained Earnings			35,168			35,549
TOTAL COMMON EQUITY		$	177,760		$	176,981
Cumulative Preferred Stock, No Par Value:
Shares Authorized - 134
Shares Outstanding - 32
Convertible:
Shares Outstanding, $7.00 Series - 14			1,457			1,457
Shares Outstanding, $8.00 Series - 7			816			816
Nonredeemable:
Shares Outstanding, $7.00 Series - 1			80			80
Shares Outstanding, $4.75 Series - 10			1,000			1,000
TOTAL PREFERRED STOCK		$	3,353		$	3,353
Long-term Debt:
8.05%, Amortizing Secured Note, due December 20, 2021		$	2,245		$	2,319
6.25%, Amortizing Secured Note, due May 19, 2028			6,685			6,895
6.44%, Amortizing Secured Note, due August 25, 2030			5,087			5,227
6.46%, Amortizing Secured Note, due September 19, 2031			5,367			5,507
4.22%, State Revolving Trust Note, due December 31, 2022			527			546
3.30% to 3.60%, State Revolving Trust Note, due May 1, 2025			3,519			3,623
3.49%, State Revolving Trust Note, due January 25, 2027			618			633
4.03%, State Revolving Trust Note, due December 1, 2026			805			825
4.00% to 5.00%, State Revolving Trust Bond, due August 1, 2021			434			434
0.00%, State Revolving Fund Bond, due August 1, 2021			352			359
3.64%, State Revolving Trust Note, due July 1, 2028			356			364
3.64%, State Revolving Trust Note, due January 1, 2028			119			122
3.45%, State Revolving Trust Note, due August 1, 2031			392			39
6.59%, Amortizing Secured Note, due April 20, 2029			5,871			6,046
7.05%, Amortizing Secured Note, due January 20, 2030			4,396			4,521
5.69%, Amortizing Secured Note, due January 20, 2030			9,017			9,273
3.75%, State Revolving Trust Note, due July 1, 2031			2,664			2,021
3.75%, State Revolving Trust Note, due November 30, 2030			1,415			1,404
First Mortgage Bonds:
5.20%, Series S, due October 1, 2022			12,000			12,000
5.25%, Series T, due October 1, 2023			6,500			6,500
5.25%, Series V, due February 1, 2029			10,000			10,000
5.35%, Series W, due February 1, 2038			23,000			23,000
0.00%, Series X, due September 1, 2018			368			375
4.25% to 4.63%, Series Y, due September 1, 2018			410			410
0.00%, Series Z, due September 1, 2019			876			894
5.25% to 5.75%, Series AA, due September 1, 2019			1,080			1,080
0.00%, Series BB, due September 1, 2021			1,183			1,206
4.00% to 5.00%, Series CC, due September 1, 2021			1,400			1,400
5.10%, Series DD, due January 1, 2032			6,000			6,000
0.00%, Series EE, due August 1, 2023			4,709			4,804
3.00% to 5.50%, Series FF, due August 1, 2024			6,160			6,160
0.00%, Series GG, due August 1, 2026			1,330			1,352
4.00% to 5.00%, Series HH, due August 1, 2026			1,640			1,640
0.00%, Series II, due August 1, 2024			1,127			1,150
3.40% to 5.00%, Series JJ, due August 1, 2027			1,560			1,560
0.00%, Series KK, due August 1, 2028			1,500			1,526
5.00% to 5.50%, Series LL, due August 1, 2028			1,635			1,635
0.00%, Series MM, due August 1, 2030			1,868			1,901
3.00% to 4.375%, Series NN, due August 1, 2030			1,985			1,985
0.00%, Series OO, due August 1, 2031			2,960			—
2.00% to 5.00%, Series PP, due August 1, 2031			915			—
SUBTOTAL LONG-TERM DEBT			140,075			136,736
Less: Current Portion of Long-term Debt			(4,996	)		(4,569	)
TOTAL LONG-TERM DEBT		$	135,079		$	132,167

See Notes to Condensed Consolidated Financial ~~Statements~~Statements.

Index

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), Tidewater Environmental Services, Inc. (TESI), Pinelands Water Company (Pinelands Water) and Pinelands Wastewater Company (Pinelands Wastewater) (collectively, Pinelands), Utility Service Affiliates, Inc. (USA), Utility Service Affiliates (Perth Amboy) Inc. (USA-PA), and Twin Lakes Utilities, Inc. (Twin Lakes). Southern Shores Water Company, LLC (Southern Shores) and White Marsh Environmental Systems, Inc. (White Marsh) are wholly-owned subsidiaries of Tidewater. The financial statements for Middlesex and its wholly-owned subsidiaries (the Company) are reported on a consolidated basis. All significant intercompany accounts and transactions have been eliminated.

The consolidated notes within the 2011 Annual Report on Form 10-K (the 2011 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 present fairly the financial position as of ~~March 31,~~June 30, 2012, ~~and~~ the results of operations for the three and six month periods ended June 30, 2012 and 2011 and cash flows for the ~~three~~six month periods ended ~~March 31,~~June 30, 2012 and 2011. Information included in the Condensed Consolidated Balance Sheet as of December 31, 2011, has been derived from the Company’s audited financial statements for the year ended December 31, 2011 included in the 2011 Form 10-K.

Contract Awarded to USA

In March 2012, the Borough of Avalon, New Jersey (Avalon) awarded an operations and maintenance contract to USA for the Avalon water utility, sewer utility and storm water system. In addition to performing the day to day operations, USA will be responsible for all billing, collections, customer service, emergency responses and capital projects funded by Avalon. The contract is for a ten year term and USA ~~assumes~~assumed operation and maintenance of the Avalon water utility, sewer utility and storm water system on July 1, 2012.

Recent Accounting Guidance

Fair Value Measurements and Disclosures– In May 2011, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2011-04, which amends Accounting Standards Codification 820, Fair Value Measurements and Disclosures, to update guidance related to fair value measurements and disclosures as a step towards achieving convergence between generally accepted accounting principles and international financial reporting standards. ASU 2011-04 clarifies intent about application of existing fair value measurements and disclosures, changes certain requirements for fair value measurements and requires expanded disclosures. ASU 2011-04 was effective for interim and annual periods beginning after December 15, 2011. The Company’s adoption of ASU 2011-04 resulted in expanded fair value disclosures and did not have any impact on the Company’s results of operations, cash flows or financial position.

Note 2– Rate Matters

Middlesex -In ~~January~~July 2012, ~~Middlesex filed an~~Middlesex’s application with the New Jersey Board of Public Utilities (NJBPU) seeking permission to increase its base water rates ~~by approximately~~was partially approved, granting an increase in annual operating revenues of $8.1 million. The originally-filed base water rate increase request of $11.3 million, ~~per year. The request~~which was filed in January 2012, was made ~~as a result~~to seek recovery of ~~capital investments Middlesex has made, or has committed to make,~~increased costs of operations, chemicals and fuel, electricity, taxes, labor and benefits, decreases in industrial and commercial customer demand patterns, as well as capital investment. The new base water rates are designed to recover these increased ~~operations and maintenance costs. We cannot predict whether the NJBPU will ultimately approve, deny, or reduce the amount~~costs, as well as a return on invested capital in rate base of ~~the request. A decision by the NJBPU is not expected until the fourth quarter~~$202.4 million based on a return on equity of 10.15%. The rate increase became effective on July 20, 2012.

Index

Tidewater –In ~~September 2011, Tidewater filed an~~June 2012, Tidewater’s application with the Delaware Public Service Commission (DEPSC) seeking permission to increase its base water rates ~~by approximately~~was partially approved, granting an increase in annual operating revenues of $3.9 million. The originally-filed base water rate increase request of $6.9 million, ~~per year. The request~~which was filed in September 2011, was made ~~as a result~~to seek recovery of ~~capital investments Tidewater has made, or has committed to make,~~increased costs for operations, maintenance and taxes, as well as ~~increased operations~~capital investment. Under PSC regulations, Tidewater had implemented interim rates in November 2011, which amounted to approximately $2.5 million on an annual basis. The new final base rates will reflect the remaining $1.4 million and ~~maintenance costs. We cannot predict whether the DEPSC will ultimately approve, deny, or reduce the amount of the request. A decision by the DEPSC is not expected until the second half of~~became effective June 19, 2012. ~~In connection with the base rate increase request, Tidewater implemented a DEPSC approved 10.49% interim rate increase, subject to refund, on November 15, 2011.~~

TESI–In ~~July 2011, TESI filed an~~June 2012, TESI’s application with the DEPSC seeking permission to increase its base wastewater rates ~~by approximately $0.8~~was partially approved, granting an increase in annual operating revenues of $0.6 million, ~~per year. TESI and all intervening parties have reached~~ a ~~settlement on the~~portion of which is to be phased in through 2015. The originally-filed base wastewater rate increase request of $0.8 million, which ~~would allow a $0.6~~was filed in July 2011, was made to seek recovery of increased operation and maintenance costs, as well as capital investment. Under PSC regulations, TESI had implemented interim rates in September 2011, which amounted to approximately $0.1 million ~~rate increase phased in over 4.5 years.~~on an annual basis. The ~~settlement has been submitted to the Hearing Examiner for his decision, which when rendered will be presented to the DEPSC for a~~new final ~~decision. TESI expects that decision to be issued during the second quarter of~~base rates became effective June 5, 2012.

Note 3 – Capitalization

Common Stock

During the ~~three~~six months ended ~~March 31,~~June 30, 2012, there were ~~21,449~~42,472 common shares (approximately ~~$0.4~~$0.8 million) issued under the Company’s Amended and Restated Dividend Reinvestment and Common Stock Purchase Plan (DRP).

The Company maintains a stock plan for its non-management directors (Outside Director Stock Compensation Plan). In May 2012, the Company granted and issued 5,768 shares of common stock (approximately $0.1 million) to the non-management directors under the plan.

Long-term Debt

OnIn May 3, 2012, Middlesex borrowed $3.9 million through the New Jersey Environmental Infrastructure Trust under the New Jersey State Revolving Fund (SRF) loan program and issued first mortgage bonds designated as Series OO ($3.0 million) and Series PP ($0.9 million). The interest rate on the Series OO bond is zero and the interest rate on the Series PP bond ranges from 2.0% to 5.0% depending on the serial maturity date. The final maturity date for both bonds is August 1, 2031. Proceeds ~~will be~~were recorded as Restricted Cash and ~~will~~may only be used for the Middlesex 2012 RENEW ~~Program.~~Program, which is Middlesex’s program to clean and cement unlined mains in the Middlesex system.

In March 2011, Tidewater closed on a $2.8 million loan with the Delaware ~~SRF~~State Revolving Fund (SRF) program which allows, but does not obligate, Tidewater to draw against a General Obligation Note for a specific project. The interest rate on any draw will be set at 3.75% with a final maturity of July 1, 2031 on the amount actually borrowed. As of ~~March 31,~~June 30, 2012, Tidewater has borrowed ~~$2.6~~$2.7 million against this loan.

In March 2011, Southern Shores closed on a $1.6 million loan with the Delaware SRF program, which allows, but does not obligate, Southern Shores to draw against a General Obligation Note for a ~~specific project no later than July 31, 2011.~~specific. The interest rate on any draw will be set at 3.75% with a final maturity of November 30, 2030 on the amount actually borrowed. As of ~~March 31,~~June 30, 2012, Southern Shores has borrowed $1.4 million against this loan.

Index

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, trade receivables, accounts payable and notes payable approximate their respective fair values due to the short-term maturities of these instruments. The fair value of the Company’s long-term debt relating to First Mortgage and SRF Bonds 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 First Mortgage and SRF Bonds in the table below are classified as Level 2 measurements. The carrying amount and fair market value of the Company’s bonds were as follows:

	(Thousands of Dollars)								(Thousands of Dollars)
	March 31, 2012				December 31, 2011				June 30, 2012				December 31, 2011
	Carrying		Fair		Carrying		Fair		Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value		Amount		Value		Amount		Value
First Mortgage Bonds	$	86,333	$	87,364	$	86,577	$	87,283	$	90,208	$	91,370	$	86,577	$	87,283
SRF Bonds	$	785	$	791	$	793	$	799	$	785	$	790	$	793	$	799

For other long-term debt for which there was no quoted market price, it was not practicable to estimate their fair value. The carrying amount of these instruments was ~~$49.4~~$49.1 million at ~~March 31,~~June 30, 2012 and $49.3 million at December 31, 2011. Customer advances for construction have a carrying amount of $21.7 million and $21.9 million, respectively, at ~~March 31,~~June 30, 2012 and December 31, 2011. 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.

~~Index~~

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 both the Convertible Preferred Stock $7.00 Series and the Convertible Preferred Stock $8.00 Series.

											(In Thousands Except per Share Amounts)
	(In Thousands Except per Share Amounts)										Three Months Ended June 30,
	Three Months Ended March 31,										2012					2011
Basic:	2012			Shares		2011			Shares		Income			Shares		Income			Shares
Net Income	$	1,807			15,692	$	2,630			15,576	$	3,725			15,716	$	3,625			15,598
Preferred Dividend		(52	)				(52	)				(51	)				(51	)
Earnings Applicable to Common Stock	$	1,755			15,692	$	2,578			15,576	$	3,674			15,716	$	3,574			15,598

Basic EPS	$	0.11				$	0.17				$	0.23				$	0.23

Diluted:
Earnings Applicable to Common Stock	$	1,755			15,692	$	2,578			15,576	$	3,674			15,716	$	3,574			15,598
$7.00 Series Preferred Dividend		24			167		24			167		24			167		24			167
$8.00 Series Preferred Dividend		14			96		14			96		14			96		14			96
Adjusted Earnings Applicable to Common Stock	$	1,793			15,955	$	2,616			15,839	$	3,712			15,979	$	3,612			15,861

Diluted EPS	$	0.11				$	0.17				$	0.23				$	0.23

Index

	(In Thousands Except per Share Amounts)
	Six Months Ended June 30,
	2012					2011
Basic:	Income			Shares		Income			Shares
Net Income	$	5,532			15,704	$	6,255			15,587
Preferred Dividend		(103	)				(103	)
Earnings Applicable to Common Stock	$	5,429			15,704	$	6,152			15,587

Basic EPS	$	0.35				$	0.40

Diluted:
Earnings Applicable to Common Stock	$	5,429			15,704	$	6,152			15,587
$7.00 Series Preferred Dividend		49			167		49			167
$8.00 Series Preferred Dividend		28			96		28			96
Adjusted Earnings Applicable to Common Stock	$	5,506			15,967	$	6,229			15,850

Diluted EPS	$	0.35				$	0.40

Note 5 – Business Segment Data

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, Delaware and Pennsylvania. This segment also includes regulated wastewater systems in New Jersey and Delaware. The Company is subject to regulations as to its rates, services and other matters by New Jersey, Delaware and Pennsylvania with respect to utility services 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. Inter-segment transactions relating to operational costs are treated as pass-through expenses. Finance charges on inter-segment loan activities are based on interest rates that are below what would normally be charged by a third party lender.

Index

	(In Thousands)
	Three Months Ended June 30,						Six Months Ended June 30,
Operations by Segments:	2012			2011			2012			2011
Revenues:
Regulated	$	24,442		$	23,437		$	45,300		$	44,673
Non – Regulated		3,089			2,774			5,847			5,615
Inter-segment Elimination		(130	)		(109	)		(200	)		(190	)
Consolidated Revenues	$	27,401		$	26,102		$	50,947		$	50,098
Operating Income:
Regulated	$	6,878		$	6,317		$	10,381		$	10,652
Non – Regulated		332			421			706			854
Consolidated Operating Income	$	7,210		$	6,738		$	11,087		$	11,506

Net Income:
Regulated	$	3,557		$	3,372		$	5,144		$	5,745
Non – Regulated		168			253			388			510
Consolidated Net Income	$	3,725		$	3,625		$	5,532		$	6,255
Capital Expenditures:
Regulated	$	6,296		$	6,024		$	12,335		$	10,856
Non – Regulated		140			127			239			183
Total Capital Expenditures	$	6,436		$	6,151		$	12,574		$	11,039

(In Thousands)
Three Months Ended
March 31,
Operations by Segments: 2012 2011
Revenues:
  Regulated $ 20,858 $ 21,236
  Non – Regulated 2,758 2,841
Inter-segment Elimination (70 ) (81 )
Consolidated Revenues $ 23,546 $ 23,996

Operating Income:
  Regulated $ 3,503 $ 4,335
  Non – Regulated 374 433
Consolidated Operating Income $ 3,877 $ 4,768

Net Income:
  Regulated $ 1,587 $ 2,373
  Non – Regulated 220 257
Consolidated Net Income $ 1,807 $ 2,630

Capital Expenditures:
  Regulated $ 6,039 $ 4,832
  Non – Regulated 394 56
Total Capital Expenditures $ 6,433 $ 4,888

	As of March 31, 2012			As of December 31, 2011			As of June 30, 2012			As of December 31, 2011
Assets:
Regulated	$	536,138		$	539,947		$	544,458		$	539,947
Non – Regulated		10,201			10,325			10,862			10,325
Inter-segment Elimination		(10,206	)		(12,736	)		(10,179	)		(12,736	)
Consolidated Assets	$	536,133		$	537,536		$	545,141		$	537,536

Note 6 – Short-term Borrowings

As of ~~March 31,~~June 30, 2012, the Company has established lines of credit aggregating $60.0 million. At ~~March 31,~~June 30, 2012, the outstanding borrowings under these credit lines were ~~$23.3~~$25.3 million at a weighted average interest rate of ~~1.27%~~1.36%.

The weighted average daily amounts of borrowings outstanding under the Company’s credit lines and the weighted average interest rates on those amounts were ~~$23.8 million and $17.3 million at 1.31% and 1.60% for the three months ended March 31, 2012 and 2011, respectively.~~as follows:

	($ In Thousands)
	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011

Average Daily Amounts Outstanding	$	24,635		$	19,548		$	24,102		$	18,426
Weighted Average Interest Rates		1.38	%		1.59	%		1.35	%		1.59	%

Index

The maturity dates for the ~~$23.3~~$25.3 million outstanding as of ~~March 31,~~June 30, 2012 are all in ~~April~~July 2012 and are extendable at the discretion of the Company.

~~Index~~

Interest rates for short-term borrowings under the lines of credit are below the prime rate with no requirement for compensating balances.

Note 7 – Commitments and Contingent Liabilities

Contract Operations -USA-PA operates the City of Perth Amboy, NJ’s water and wastewater systems under a 20-year agreement, which expires in 2018. In connection with the agreement with Perth Amboy, USA-PA entered into a 20-year subcontract with a wastewater operating company for the operation and maintenance of the Perth Amboy wastewater collection system. The subcontract provides for the sharing of certain fixed and variable fees and operating expenses.

Water Supply

Middlesex has an agreement with the NJWSA for the purchase of untreated water through November 30, 2023, which provides for an average purchase of 27 million gallons a day (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 regulated water utility for the purchase of treated water. This agreement, which expires February 27, 2016, provides for the minimum purchase of 3 mgd of treated water with provisions for additional purchases.

Purchased water costs are shown below:

	(In Thousands) Three Months Ended March 31,				(In Thousands)
	2012		2011		Three Months Ended June 30,				Six Months Ended June 30,
Purchased Water
					2012		2011		2012		2011

Treated	$	719	$	640	$	775	$	652	$	1,494	$	1,292
Untreated		612		606		516		516		1,128		1,122
Total Costs	$	1,331	$	1,246	$	1,291	$	1,168	$	2,622	$	2,414

Construction

The Company has budgeted approximately $21.8 million on its construction program in 2012. The actual amount and timing of capital expenditures is dependent on project scheduling and refinement of engineering estimates for certain projects.

Litigation

The Company is a defendant in lawsuits in the normal course of business. We believe the resolution of pending claims and legal proceedings will not have a material adverse effect on the Company’s consolidated financial statements.

Change in Control Agreements

The Company has Change in Control Agreements with certain of its officers that provide compensation and benefits in the event of termination of employment in connection with a change in control of the Company.

910

Index

Note 8 – Employee Benefit Plans

Pension Benefits

The Company’s Pension Plan covers substantially all employees hired prior to March 31, 2007. Employees hired after March 31, 2007 are not eligible to participate in this plan, but do participate in a defined contribution plan that provides an annual contribution into a self-directed retirement account at the discretion of the Company, based upon a percentage of the participants’ compensation. In order to be eligible for contribution, the participating employee must be employed by the Company on December 31st of the year to which the award relates. For the three months ended ~~March 31,~~June 30, 2012, the Company did not make any Pension Plan cash contributions. For the three months ended June 30, 2011, the Company made Pension Plan cash contributions of $0.4 million. For the six months ended June 30, 2012 and 2011, the Company made Pension Plan cash contributions of $0.8 million and ~~$0.4~~$0.7 million, respectively. The Company expects to make additional Pension Plan cash contributions of approximately $3.3 million over the remainder of the current year. The Company also maintains an unfunded supplemental retirement benefit plan for certain active and retired Company officers and currently pays $0.3 million in annual benefits to the retired participants.

Other Benefits

The Company’s Other Benefits Plan covers substantially all of its retired employees. Employees hired after March 31, 2007 are not eligible to participate in this plan. Coverage includes healthcare and life insurance. For the three months ended ~~March 31,~~June 30, 2012 and 2011, the Company did not make any Other Benefits Plan cash contributions. For the six months ended June 30, 2012 and 2011, the Company made Other Benefits Plan cash contributions of $0.8 million and $0.5 million, respectively. The Company expects to make additional Other Benefits Plan cash contributions of approximately $4.0 million over the remainder of the current year.

The following ~~table sets~~tables set forth information relating to the Company’s periodic costs for its employee retirement benefit plans:

(In Thousands)
Pension Benefits Other Benefits
Three Months Ended March 31,
2012 2011 2012 2011

Service Cost $ 550 $ 394 $ 446 $ 326
Interest Cost 604 565 467 401
Expected Return on Assets (615 ) (571 ) (314 ) (256 )
Amortization of Unrecognized Losses 387 141 441 219
Amortization of Unrecognized Prior Service Cost 2 2 — —
Amortization of Transition Obligation — — 34 34
Net Periodic Benefit Cost $ 928 $ 531 $ 1,074 $ 724

	(In Thousands)
	Pension Benefits						Other Benefits
	Three Months Ended June 30,
	2012			2011			2012			2011

Service Cost	$	549		$	393		$	446		$	327
Interest Cost		604			565			467			401
Expected Return on Assets		(614	)		(570	)		(315	)		(257	)
Amortization of Unrecognized Losses		388			142			442			220
Amortization of Unrecognized Prior Service Cost		3			3			—			—
Amortization of Transition Obligation		—			—			34			34
Net Periodic Benefit Cost	$	930		$	533		$	1,074		$	725

1011

Index


	(In Thousands)
	Pension Benefits						Other Benefits
	Six Months Ended June 30,
	2012			2011			2012			2011

Service Cost	$	1,099		$	787		$	892		$	653
Interest Cost		1,208			1,130			934			802
Expected Return on Assets		(1,229	)		(1,141	)		(629	)		(513	)
Amortization of Unrecognized Losses		775			283			883			439
Amortization of Unrecognized Prior Service Cost		5			5			—			—
Amortization of Transition Obligation		—			—			68			68
Net Periodic Benefit Cost	$	1,858		$	1,064		$	2,148		$	1,449

Index

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

The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements of Middlesex Water Company (Middlesex or the Company) included elsewhere herein and with the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

Forward-Looking Statements

Certain statements contained in this periodic report and in the documents incorporated by reference constitute “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933. The Company intends that these statements be covered by the safe harbors created under those laws. These statements include, but are not limited to:

statements as to expected financial condition, performance, prospects and earnings of the Company;

statements regarding strategic plans for growth;

statements regarding the amount and timing of rate increases and other regulatory matters, including the recovery of certain costs recorded as regulatory assets;

statements as to the Company’s expected liquidity needs during the upcoming fiscal year and beyond and statements as to the sources and availability of funds to meet its liquidity needs;

statements as to expected rates, consumption volumes, service fees, revenues, margins, expenses and operating results;

statements as to the Company’s compliance with environmental laws and regulations and estimations of the materiality of any related costs;

statements as to the safety and reliability of the Company’s equipment, facilities and operations;

statements as to financial projections;

statements as to the ability of the Company to pay dividends;

statements as to the Company’s plans to renew municipal franchises and consents in the territories it serves;

expectations as to the amount of cash contributions to fund the Company’s retirement benefit plans, including statements as to anticipated discount rates and rates of return on plan assets;

statements as to trends; and

statements regarding the availability and quality of our water supply.

These forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from future results expressed or implied by the forward-looking statements. Important factors that could cause actual results to differ materially from anticipated results and outcomes include, but are not limited to:

the effects of general economic conditions;

increases in competition in the markets served by the Company;

the ability of the Company to control operating expenses and to achieve efficiencies in its operations;

the availability of adequate supplies of water;

actions taken by government regulators, including decisions on rate increase requests;

new or additional water quality standards;

weather variations and other natural phenomena;

the existence of ~~financially~~ attractive ~~acquisition candidates~~growth opportunities and the risks involved in pursuing those ~~acquisitions;~~opportunities;

acts of war or terrorism;

significant changes in the pace of housing development in Delaware;

the availability and cost of capital resources;

the ability to translate Preliminary Survey & Investigation (PS&I) charges into viable projects; and

other factors discussed elsewhere in this quarterly report.

1113

Index

Many of these factors are beyond the Company’s ability to control or predict. Given these uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements, which only speak to the Company’s understanding as of the date of this report. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.

For an additional discussion of factors that may affect the Company’s business and results of operations, see Item 1A. - Risk Factors in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

Overview

Middlesex has operated as a water utility in New Jersey since 1897, in Delaware through our wholly-owned subsidiary, Tidewater Utilities, Inc. (Tidewater), since 1992 and in Pennsylvania through our wholly-owned subsidiary, Twin Lakes Utilities, Inc. (Twin Lakes), since 2009. We are in the business of collecting, treating and distributing water for domestic, commercial, municipal, industrial and fire protection purposes. We also operate a New Jersey municipal water and wastewater system under contract and provide wastewater services in New Jersey and Delaware through our subsidiaries. We are regulated as to rates charged to customers for water and wastewater services, as to the quality of water service we provide and as to certain other matters in New Jersey, Delaware and Pennsylvania. Only our Utility Services Affiliates, Inc. (USA), Utility Services Affiliates (Perth Amboy), Inc. (USA-PA) and White Marsh Environmental Systems, Inc. (White Marsh) subsidiaries are not regulated utilities.

Our New Jersey water utility system (the Middlesex System) provides water services to approximately 60,000 retail customers, primarily in central New Jersey. The Middlesex System also provides water service under contract to several municipalities in central New Jersey. In partnership with our subsidiary, USA-PA, we operate the water supply system and wastewater system for the City of Perth Amboy, New Jersey. Our Bayview system provides water services in Downe Township, New Jersey. Our other New Jersey subsidiaries, Pinelands Water Company and Pinelands Wastewater Company (collectively, Pinelands), provide water and wastewater services to residents in Southampton Township, New Jersey.

USA offers residential customers in New Jersey and Delaware water service line and sewer lateral maintenance programs, which are serviced by HomeServe USA (HomeServe), a leading provider of home maintenance service programs. HomeServe has recently expanded its maintenance offerings under the program to include other household services. USA receives a service fee for the billing, cash collection and other administrative matters associated with HomeServe’s service contracts. In February 2012, USA began to operate a wastewater treatment facility under contract at an industrial site in Southern New Jersey. ~~Beginning~~On July 1, 2012, USA ~~will operate~~began operating the water and sewer utilities and storm water system of the Borough of Avalon, New Jersey.

Our Delaware subsidiaries, Tidewater and Southern Shores Water Company, LLC (Southern Shores), provide water services to approximately 36,000 retail customers in New Castle, Kent and Sussex Counties, Delaware. Tidewater’s subsidiary, White Marsh, services an additional 4,700 customers in Kent and Sussex Counties through various operations and maintenance contracts.

Our Tidewater Environmental Services, Inc. (TESI) subsidiary provides wastewater services to approximately 2,200 residential retail customers. We expect the growth of our regulated wastewater operations in Delaware will eventually become a more significant component of our operations.

~~Index~~

Our Pennsylvania subsidiary, Twin Lakes, provides water services to approximately 120 retail customers in the Township of Shohola, Pike County, Pennsylvania.

Index

The majority of our revenue is generated from retail and contract water services to customers in our service areas. We record water service revenue as such service is rendered and include estimates for amounts unbilled at the end of the period for services provided after the last billing cycle. Fixed service charges are billed in advance by our subsidiary, Tidewater, and are recognized in revenue as the service is provided.

Our ability to increase operating income and net income is based significantly on four factors: weather, adequate and timely rate relief, effective cost management, and customer growth. These factors are evident in the discussions below which compare our results of operations with prior periods.

Recent Developments

Rate Matters

Contract Awarded to USA

In March 2012, the Borough of Avalon, New Jersey (Avalon) awarded an operations and maintenance contract to USA for the Avalon water utility, sewer utility and storm water system. In addition to performing the day to day operations, USA will be responsible for all billing, collections, customer service, emergency responses and capital projects funded by Avalon. The contract is for a ten year term and USA ~~assumes operation and maintenance of~~began operating the ~~Avalon water utility, sewer utility and storm water system~~systems on July 1, 2012. The contract is expected to contribute less than $0.01 to annual earnings per share.

1315

Index

Outlook

Revenues for 2012 are expected to be favorably impacted ~~by interim and final~~from approved rate increases at Middlesex, Tidewater, TESI, Southern Shores and Twin Lakes. In addition, Pinelands Water and Pinelands Wastewater ~~expect~~intend to file for base rate increases in the third quarter of 2012. ~~The~~Any decision on the expected rate ~~increases that Middlesex, Tidewater, TESI, Pinelands Water and Pinelands Wastewater filed, or expect to file, have not been approved by each company’s respective Utility Commission. There can~~filing would be ~~no assurances that the requested rate increases will be approved~~rendered in ~~whole or in part or when the final decisions will be rendered.~~2013.

Ongoing economic conditions continue to negatively impact our customers’ water consumption, particularly the level of water usage by our commercial and industrial customers in our Middlesex system. We are unable to determine when these customers’ water demands may fully return to previous levels, or if a reduced level of demand will continue indefinitely. We were given appropriate recognition for ~~a portion of~~ this decrease in customer consumption in Middlesex’s ~~March 2010~~July 2012 rate ~~increase and we are seeking similar treatment in the current rate increase request, but there can be no assurances such recognition will be granted by the NJBPU.~~increase.

Revenues and earnings are influenced by weather. Changes in usage patterns, as well as increases in capital expenditures and operating costs, are the primary factors in determining the need for rate increase requests. We ~~continue to~~continuously implement plans to streamline operations and reduce operating costs.

Changes in certain actuarial assumptions, including a lower discount rate and revised plan participant mortality factors, as well as a lower actual return in 2011 on assets held in our retirement plan funds resulted in a significant increase in our underfunded employee benefit plan obligation and will result in higher employee benefit plan expense and cash contributions in 2012. The rate increases recently approved for Tidewater and Middlesex ~~have included these~~reflected the resulting increased employee benefit plan ~~expenses in their rate increase applications currently under review by the respective Utility Commissions.~~expenses.

As a result of ongoing challenging economic conditions impacting the pace of new residential home construction, there may be an increase in the amount of PS&I costs that will not be currently recoverable in rates. If it is determined that recovery is unlikely, the ~~applicable~~ PS&I costs deemed unrecoverable will be charged against income in the period of determination.

Our strategy is focused on four key areas:

Serve as a trusted and continually-improving provider of safe, reliable and cost-effective water, wastewater and related services;

Provide a comprehensive suite of water and wastewater solutions in the continually-developing Delaware market that results in profitable growth;

Pursue profitable growth in our core states of New Jersey and Delaware, as well as additional states; and

Invest in products, services and other viable opportunities that complement our core competencies.

1416

Index

Operating Results by Segment

The discussion of the Company’s operating results is on a consolidated basis and includes significant factors by subsidiary. The Company has two operating segments, Regulated and Non-Regulated.

The segments in the tables included below consist of the following companies: Regulated-Middlesex, Tidewater, Pinelands, Southern Shores, TESI and Twin Lakes; Non-Regulated- USA, USA-PA, and White Marsh.

Results of Operations – Three Months Ended ~~March 31,~~June 30, 2012

(In Thousands)
Three Months Ended March 31,

2012 2011
Regulated Non-
Regulated

Total
Regulated Non-
Regulated Total
Revenues $ 20,841 $ 2,705 $ 23,546 $ 21,208 $ 2,788 $ 23,996
Operations and maintenance expenses 12,156 2,219 14,375 11,780 2,251 14,031
Depreciation expense 2,512 36 2,548 2,375 37 2,412
Other taxes 2,670 76 2,746 2,718 67 2,785
Operating income 3,503 374 3,877 4,335 433 4,768

Other income, net 141 47 188 246 56 302
Interest expense 1,332 22 1,354 1,188 26 1,214
Income taxes 725 179 904 1,020 206 1,226
Net income $ 1,587 $ 220 $ 1,807 $ 2,373 $ 257 $ 2,630

	(In Thousands)
	Three Months Ended June 30,
	2012						2011
	Regulated		Non- Regulated		Total		Regulated		Non- Regulated		Total
Revenues	$	24,389	$	3,012	$	27,401	$	23,381	$	2,721	$	26,102
Operations and maintenance expenses		12,207		2,558		14,765		11,867		2,195		14,062
Depreciation expense		2,541		41		2,582		2,380		37		2,417
Other taxes		2,763		81		2,844		2,817		68		2,885
Operating income		6,878		332		7,210		6,317		421		6,738

Other income, net		235		16		251		229		59		288
Interest expense		1,754		25		1,779		1,689		25		1,714
Income taxes		1,802		155		1,957		1,485		202		1,687
Net income	$	3,557	$	168	$	3,725	$	3,372	$	253	$	3,625

Operating revenues for the three months ended June 30, 2012 increased $1.3 million from the same period in 2011. This increase was primarily related to the following factors:

Middlesex System revenues increased $0.1 million, primarily due to:

Sales to General Metered Service (GMS) customers increased by $0.2 million due to increased customer demand for water and implementation of a purchased water adjustment clause in August 2011; and

Contract Sales to Municipalities decreased by $0.1 million due to lower customer demand for water;

Tidewater System revenues increased $0.7 million, primarily due to the 10.49% interim rate increase that went into effect in November 2011 and increased connection fees;

USA-PA’s revenues increased $0.2 million, primarily from scheduled increases in the fixed fees paid under contract with the City of Perth Amboy;

Southern Shores’ revenues increased $0.1 million, primarily due to rate increases that went into effect in June 2011 and January 2012; and

Revenues from all other subsidiaries increased $0.2 million.

Index

Operation and Maintenance Expense

Operation and maintenance expenses for the three months ended June 30, 2012 increased $0.7 million from the same period in 2011. This increase was primarily related to the following factors:

Employee benefit expenses increased $0.6 million, primarily due to changes in certain postretirement benefit plan actuarial assumptions, including a lower discount rate and revised plan participant mortality factors, as well as a lower actual return on assets held in our retirement plan funds;

Reserves for bad debts increased $0.1 million;

Costs associated with main breaks decreased $0.1 million, due to more favorable weather conditions, which led to below average number of main breaks in 2012;

Labor costs decreased $0.2 million primarily due to higher capitalized payroll and decreased headcount; and

Operation and maintenance expenses for all other categories increased $0.3 million.

Depreciation

Depreciation expense for the three months ended June 30, 2012 increased $0.2 million from the same period in 2011 due to a higher level of utility plant in service.

Other Taxes

Other taxes for the three months ended June 30, 2012 was consistent with the same period in 2011.

Interest Charges

Interest charges for the three months ended June 30, 2012 increased $0.1 million fromthe same period in 2011, primarily due to higher average short and long term debt outstanding in the second quarter of 2012 as compared to the second quarter of 2011.

Other Income, net

Other Income, net for the three months ended June 30, 2012 was consistent with the same period in 2011.

Income Taxes

Income taxes for the three months ended June 30, 2012 increased $0.3 millionfromthe same period in 2011, due to increased operating income in 2012 as compared to 2011.

Net Income and Earnings Per Share

Net income for the three months ended June 30, 2012 increased $0.1 million from the same period in 2011. Basic and diluted earnings per share was $0.23 for the each of the three months ended June 30, 2012 and 2011.

Index

Results of Operations – Six Months Ended June 30, 2012

	(In Thousands)
	Six Months Ended June 30,
	2012						2011
	Regulated		Non- Regulated		Total		Regulated		Non- Regulated		Total
Revenues	$	45,230	$	5,717	$	50,947	$	44,589	$	5,509	$	50,098
Operations and maintenance expenses		24,363		4,777		29,140		23,647		4,446		28,093
Depreciation expense		5,053		77		5,130		4,755		74		4,829
Other taxes		5,433		157		5,590		5,535		135		5,670
Operating income		10,381		706		11,087		10,652		854		11,506

Other income, net		376		63		439		475		115		590
Interest expense		3,086		47		3,133		2,877		51		2,928
Income taxes		2,527		334		2,861		2,505		408		2,913
Net income	$	5,144	$	388	$	5,532	$	5,745	$	510	$	6,255

Operating Revenues

Operating revenues for the ~~three~~six months ended ~~March 31,~~June 30, 2012 ~~decreased $0.5~~increased $0.8 million from the same period in 2011. This ~~decrease~~increase was primarily related to the following factors:

Middlesex System revenues decreased ~~$0.8~~$0.7 million, primarily due to:

Sales to ~~General Metered Service (GMS)~~GMS customers decreased by ~~$0.5~~$0.3 million due to decreased customer demand for water. The decline in water use by our GMS customers includes commercial and industrial (C&I) customers. Several of the larger industrial customers’ consumption demands have decreased due to reduced output from their production processes. We have also seen a decline in consumption from our commercial customers, which are generally office facilities, guest facilities and multi-family residential facilities. Certain of our C&I customers are unable to determine when their water demands may return to previous levels or if the declines will continue; and

Contract Sales to Municipalities decreased by ~~$0.3~~$0.4 million due to lower customer demand for ~~water.~~water;

Tidewater System revenues increased ~~$0.4~~$1.1 million, primarily due to the 10.49% interim rate increase that went into effect in November 2011 and increased connection ~~fees.~~fees;

USA-PA’s revenues increased $0.2 million, primarily from scheduled increases in the fixed fees paid under contract with the City of Perth Amboy;

Southern Shores’ revenues increased $0.1 million, primarily due to rate increases that went into effect in June 2011 and January 2012; and

Revenues from all other subsidiaries ~~decreased~~increased $0.1 million.

1519

Index

Operation and Maintenance Expense

Operation and maintenance expenses for the ~~three~~six months ended ~~March 31,~~June 30, 2012 increased ~~$0.3~~$1.0 million from the same period in 2011. This increase was primarily related to the following factors:

~~Postretirement~~Employee benefit ~~plan~~ expenses increased ~~$0.5~~$1.1 million, primarily due to changes in certain postretirement benefit plan actuarial assumptions, including a lower discount rate and revised plan participant mortality factors, as well as a lower actual return on assets held in our retirement plan funds;

Reserves for bad debts increased $0.1 million;

Costs associated with main breaks decreased ~~$0.1~~$0.2 million, due to more favorable ~~winter~~ weather conditions, which led to below average number of main breaks in ~~the first quarter of~~ 2012; ~~and~~

Labor costs decreased ~~$0.1~~$0.3 million primarily due to higher capitalized payroll and less overtime expended on main ~~breaks.~~breaks; and

Operation and maintenance expenses for all other categories increased $0.3 million.

Depreciation

Depreciation expense for the ~~three~~six months ended ~~March 31,~~June 30, 2012 increased ~~$0.1~~$0.3 million from the same period in 2011 due to a higher level of utility plant in service.

Other Taxes

Other taxes for the ~~three~~six months ended ~~March 31,~~June 30, 2012 ~~was down slightly~~decreased $0.1 million from the same period in 2011 primarily due to lower revenue related taxes for our New Jersey operations compared to the same period in 2011.

Interest Charges

Interest charges for the ~~three~~six months ended ~~March 31,~~June 30, 2012 increased ~~$0.1~~$0.2 million fromthe same period in 2011, primarily due to primarily due to higher average short and long term debt outstanding in ~~the first quarter of~~ 2012 as compared to ~~the first quarter of~~ 2011.

Other Income, net

Other Income, net for the ~~three~~six months ended ~~March 31,~~June 30, 2012 decreased ~~$0.1~~$0.2 million fromthe same period in 2011, primarily due to ~~increased Other Expenses of $0.1 million~~lower Allowance for ~~certain costs related to potential projects at our Delaware subsidiaries.~~Funds Used During Construction, resulting from lower average construction work in progress balances.

Income Taxes

Income taxes for the ~~three~~six months ended ~~March 31,~~June 30, 2012 decreased ~~$0.3~~$0.1 millionfromthe same period in 2011, due to decreased operating income in 2012 as compared to 2011.

Net Income and Earnings Per Share

Net income for the ~~three~~six months ended ~~March 31, 2012 decreased $0.8~~June 30, 2012decreased $0.7 million from the same period in 2011. Basic and diluted earnings per share decreased to ~~$0.11~~$0.35 for the ~~three~~six months ended ~~March 31,~~June 30, 2012 as compared to ~~$0.17~~$0.40 for the ~~three~~six months ended ~~March 31,~~June 30, 2011.

1620

Index

Liquidity and Capital Resources

Operating Cash Flows

Cash flows from operations are largely based on four factors: weather, adequate and timely rate increases, effective cost management and customer growth. The effect of those factors on net income is discussed in “Results of Operations.”

For the ~~three~~six months ended ~~March 31,~~June 30, 2012, cash flows from operating activities ~~decreased $0.9~~increased $3.7 million to ~~$7.1~~$15.8 million. Decreased ~~earnings was~~accounts receivable and timing of certain income tax payments were the primary reason for the ~~decrease~~increase in cash flow. The ~~$7.1~~$15.8 million of net cash flow from operations enabled us to fund 100% of our utility plant expenditures internally for the period.

Capital Expenditures and Commitments

To fund our capital program, we use internally generated funds, short-term and long-term debt borrowings and, when market conditions are favorable, proceeds from sales of common stock under our Amended and Restated Dividend Reinvestment and Common Stock Purchase Plan (DRP) and common stock offerings. See below for a more detailed discussion regarding the funding of our capital program.

The capital investment program for 2012 is currently estimated to be $21.8 million. Through ~~March 31,~~June 30, 2012, we have expended ~~$6.4~~$12.6 million and expect to incur approximately ~~$15.4~~$9.2 million for capital projects for the remainder of 2012.

We currently project that we may be required to expend approximately $34.0 million for capital projects in 2013 and 2014. The actual amount and timing of capital expenditures is dependent on project scheduling and refinement of engineering estimates for certain capital ~~projects..~~projects.

To fund our capital program for the remainder of 2012, we plan on utilizing:

Internally generated funds

Proceeds from the sale of common stock through the DRP

Funds available and held in trust under existing New Jersey and Delaware State Revolving Fund (SRF) loans (currently, ~~$1.5 million)~~$3.7 million and $0.9 million, respectively). The SRF programs provide low cost financing for projects that meet certain water quality and system improvement benchmarks.

~~Funds from a $3.9 million New Jersey SRF loan that closed on May 3, 2012.~~

Short-term borrowings, if necessary, through $60.0 million of available lines of credit with several financial institutions. As of ~~March 31,~~June 30, 2012, the outstanding borrowings under these credit lines were ~~$23.3~~$25.3 million.

Recent Accounting Pronouncements – See Note 1 of the Notes to Unaudited Condensed Consolidated Financial Statements for a discussion of recent accounting pronouncements.

Item 3. Quantitative and Qualitative Disclosures of Market Risk

The Company is subject to the risk of fluctuating interest rates in the normal course of business. Our policy is to manage interest rates through the use of fixed rate long-term debt and, to a lesser extent, short-term debt. The Company’s interest rate risk related to existing fixed rate, long-term debt is not material due to the term of the majority of our First Mortgage Bonds, which have final maturity dates ranging from 2018 to 2038. Over the next twelve months, approximately ~~$4.7~~$5.0 million of the current portion of 3234 existing long-term debt instruments will mature. Applying a hypothetical change in the rate of interest charged by 10% on those borrowings, would not have a material effect on our earnings.

1721

Index

Item 4. Controls and Procedures

Disclosure Controls and Procedures

As required by Rule 13a-15 under the Securities and Exchange Act of 1934 (the Exchange Act), an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures was conducted by the Company’s Chief Executive Officer along with the Company’s Chief Financial Officer. Based upon that evaluation, the Company’s Chief Executive Officer and the Company’s Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective as of the end of the period covered by this Report. There were no changes in our internal control over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in Company reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in Company reports filed under the Exchange Act is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer as appropriate, to allow timely decisions regarding disclosure.

Material Change in Internal Controls

In the second quarter of 2012, the Company implemented the work and asset management module of an enterprise resource planning (ERP) system. As previously disclosed, the Company had implemented various other modules of the ERP system in 2010.

The implementation of the work and asset management module and the related workflow changes have resulted in material changes to the Company’s internal controls over financial reporting (as that term is defined in Rule 13(a)-15 under the Exchange Act). In connection with the implementation of the work and asset management module, the Company is continuing to replace and supplement existing internal controls over financial reporting, as appropriate. The decision to implement the ERP system was made to improve the efficiency and effectiveness of our management and financial reporting systems and was not made in response to any actual or perceived deficiencies in the Company’s internal control over financial reporting.

We continually review our disclosure controls and procedures and make changes, as necessary, to ensure the quality of our financial reporting. Other than the changes made related to the implementation of the work and asset management module and the related work flow changes, there have been no changes in internal control over financial reporting that occurred in the second quarter of 2012 that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

1822

Index

PART II. OTHER INFORMATION

Item 1.

Legal Proceedings

None.

Item 1A.

Risk Factors

The information about risk factors does not differ materially from those set forth in Part I, Item 1A. of the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3.

Defaults Upon Senior Securities

None.

Item 4.

Mine Safety Disclosures

Not applicable.

Item 5.

Other Information

None.

Item 6.	Exhibits

10.43	Copy of Loan Agreement By and Between The State of New Jersey, Acting By and Through The New Jersey Department of Environmental Protection and Middlesex Water Company, dated as of May 1, 2012 (Series 00).

10.44	Copy of Loan Agreement by and Between New Jersey Environmental Infrastructure Trust and Middlesex Water Company dated as of May 1, 2012 (Series PP).

31.1	Section 302 Certification by Dennis W. Doll pursuant to Rules 13a-14 and 15d-14 of the Securities Exchange Act of 1934.

31.2	Section 302 Certification by A. Bruce O’Connor pursuant to Rules 13a-14 and 15d-14 of the Securities Exchange Act of 1934.

32.1	Section 906 Certification by Dennis W. Doll pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.2	Section 906 Certification by A. Bruce O’Connor pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

101.INS	XBRL Instance Document

101.SCH	XBRL Schema Document

101.CAL	XBRL Calculation Linkbase Document

101.LAB	XBRL Labels Linkbase Document

101.PRE	XBRL Presentation Linkbase Document

101.DEF	XBRL Definition Linkbase Document

1923

Index

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MIDDLESEX WATER COMPANY

	By:	/s/A. Bruce O’Connor
		A. Bruce O’Connor
		Vice President and
		Chief Financial Officer
		(Principal Accounting Officer)

~~Date: May 4,~~Dated: August 2, 2012

		March 31,		December 31,
ASSETS		2012		2011
UTILITY PLANT:	Water Production	$	128,324	$	127,827
	Transmission and Distribution		329,224		326,629
	General		48,067		47,519
	Construction Work in Progress		14,040		12,575
	TOTAL		519,655		514,550
	Less Accumulated Depreciation		93,740		92,351
	UTILITY PLANT - NET		425,915		422,199

CURRENT ASSETS:	Cash and Cash Equivalents		854		3,106
	Accounts Receivable, net		10,628		11,280
	Unbilled Revenues		4,587		4,842
	Materials and Supplies (at average cost)		2,003		2,023
	Prepayments		1,121		1,622
	TOTAL CURRENT ASSETS		19,193		22,873

DEFERRED CHARGES	Unamortized Debt Expense		2,570		2,611
AND OTHER ASSETS:	Preliminary Survey and Investigation Charges		5,088		5,179
	Regulatory Assets		66,760		67,302
	Operations Contracts and Developer Fees Receivable		4,957		5,300
	Restricted Cash		2,518		3,260
	Non-utility Assets - Net		8,485		8,182
	Other		647		630
	TOTAL DEFERRED CHARGES AND OTHER ASSETS		91,025		92,464
	TOTAL ASSETS	$	536,133	$	537,536

CAPITALIZATION AND LIABILITIES
CAPITALIZATION:	Common Stock, No Par Value	$	142,008	$	141,432
	Retained Earnings		34,399		35,549
	TOTAL COMMON EQUITY		176,407		176,981
	Preferred Stock		3,353		3,353
	Long-term Debt		131,729		132,167
	TOTAL CAPITALIZATION		311,489		312,501

CURRENT	Current Portion of Long-term Debt		4,739		4,569
LIABILITIES:	Notes Payable		23,250		24,250
	Accounts Payable		4,826		5,706
	Accrued Taxes		10,144		7,847
	Accrued Interest		906		1,628
	Unearned Revenues and Advanced Service Fees		684		734
	Other		1,400		1,953
	TOTAL CURRENT LIABILITIES		45,949		46,687

COMMITMENTS AND CONTINGENT LIABILITIES (Note 7)

DEFERRED CREDITS	Customer Advances for Construction		21,903		21,944
AND OTHER LIABILITIES:	Accumulated Deferred Investment Tax Credits		1,127		1,146
	Accumulated Deferred Income Taxes		37,421		37,022
	Employee Benefit Plans		50,372		51,007
	Regulatory Liability - Cost of Utility Plant Removal		8,217		8,029
	Other		997		994
	TOTAL DEFERRED CREDITS AND OTHER LIABILITIES		120,037		120,142

CONTRIBUTIONS IN AID OF CONSTRUCTION			58,658		58,206
	TOTAL CAPITALIZATION AND LIABILITIES	$	536,133	$	537,536

	(In Thousands)
	Three Months Ended March 31,
Operations by Segments:	2012			2011
Revenues:
Regulated	$	20,858		$	21,236
Non – Regulated		2,758			2,841
Inter-segment Elimination		(70	)		(81	)
Consolidated Revenues	$	23,546		$	23,996
Operating Income:
Regulated	$	3,503		$	4,335
Non – Regulated		374			433
Consolidated Operating Income	$	3,877		$	4,768

Net Income:
Regulated	$	1,587		$	2,373
Non – Regulated		220			257
Consolidated Net Income	$	1,807		$	2,630

Capital Expenditures:
Regulated	$	6,039		$	4,832
Non – Regulated		394			56
Total Capital Expenditures	$	6,433		$	4,888

MIDDLESEX WATER COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)