ARTNA

MKT CAP $255.8MP/E 14.4DIV YIELD 3.81%FCF YIELD -7.11%REV TTM $116.9M +5.9%NET INCOME $23.6M +5.5%NET DEBT $166.6M52W 30.50 – 36.69SEC XBRL · TTM TO Invalid Date

How ARTNA rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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Substantial portions of Delaware, particularly outside of northern New Castle County, are not served by a public water or wastewater system and represent potential opportunities for Artesian Water and Artesian Wastewater to obtain new exclusive franchised service areas.
We hold Certificates of Public Convenience and Necessity, or CPCNs, for approximately 312 square miles of exclusive water service territory, most of which is in Delaware with some territory being in Maryland and Pennsylvania.
Our largest connected regional water system, consisting of approximately 145 square miles and 81,000 metered customers, is located in northern New Castle County and portions of southern New Castle County, Delaware.
Artesian Water produced approximately 80.5% of our 2025 consolidated operating revenues.
We derive about 93% of our self-supplied groundwater from wells that pump groundwater from aquifers and other formations located in the Atlantic Coastal Plain.
The remaining 7% of our groundwater supply comes from wells in the Piedmont Province.
We have 64 different water treatment facilities in our Delaware systems.
Nearly 97% of the overall 9.2 billion gallons of water we distributed in all of our Delaware systems during 2025 came from our groundwater wells, while the remaining 3% came from interconnections with other utilities and municipalities.
In Delaware in 2025, we pumped an average of 24.3 million gallons per day, or mgd, from our groundwater wells and obtained an average of approximately 0.9 mgd from interconnections.
In Delaware, we have 25 interconnections with three neighboring water utilities and seven municipalities that provide us with the ability to purchase or sell water.
As of December 31, 2025, we were serving customers through approximately 1,515 miles of transmission and distribution mains.
Artesian Water Maryland owns and operates 9 public water systems.
The majority of the 0.5 billion gallons of water we distributed in all of our Maryland systems during 2025 came from our groundwater wells, while a portion came from treated surface water.
In early 2026, a new treatment facility was completed that provides 625,000 gallon per day treated process wastewater disposal services for residential and small commercial customers.
TESI owns and operates four wastewater treatment facilities, which, combined, are permitted to treat and/or dispose of approximately 525 ,000 gallons per day.
Artesian Utility also offers protection plans to customers, the Water Service Line Protection Plan, or WSLP Plan, the Sewer Service Line Protection Plan, or SSLP Plan, and the Internal Service Line Protection Plan, or ISLP Plan (collectively, SLP Plan or SLP Plans).
The Company discontinued enrolling new customers in the ISLP Plan effective January 2026.
For customers that were previously enrolled, the ISLP Plan enhances available coverage to include water and wastewater lines within customers' residences up to an annual limit.
We have made significant enhancements to existing facilities to effectively treat and remove compounds as required by government agencies, such as ultraviolet oxidation treatment, ceramic membrane filtration and carbon filtration.
At the national level, water utilities also will be required to meet the new MCLs by April 2029 and to notify the public of any violations of the MCLs as of and after that date.
Delaware water utilities are required to notify the public of any violations of the MCLs beginning January 15, 2026.To allow drinking water systems more time to develop plans for addressing PFAS where they are found and implement solutions, the EPA plans to develop a rulemaking to provide additional time for compliance, including a proposal to extend the compliance date to 2031.
The EPA plans to finalize this rule in the Spring of 2026.
The Company has installed treatment for PFAS at several wellfields to date and plans to continue to install treatment at additional locations as necessary in future years.
Under Delaware state laws and regulations, we are required to file applications with DNREC for water allocation permits for each of our operating wells pumping greater than 50,000 gallons per day.
We have 154 operating and 63 observation and monitoring wells in our Delaware systems.
At December 31, 2025, we had allocation permits for 124 wells, permits pending for 14 wells and 16 wells that did not require a permit.
We are also subject to water allocation regulations that control the amount of water that we can draw from water sources.
We have 15 operating wells and one surface water in-take in our Maryland systems.
In March 2024, the SEC passed rule changes that would have required registrants to include extensive climate-related information in their registration statements and periodic reports.
In March 2025, the SEC announced that it had voted to end its defense of the final rules on the enhancement and standardization of climate-related disclosures.
While climate-related risk and emissions disclosure requirements continue to evolve at the state level, the future of the SEC’s climate-related disclosure rules remains uncertain, and it is unlikely that public companies will need to make disclosures under the SEC’s climate rules.
As the sole regional regulated wastewater utility in Sussex County, Delaware, our operational initiatives are not impacted by competing franchise applications, which ensures uninterrupted service and protection against service area encroachment.
Employees and Human Capital Resources As of December 31, 2025, we operated with 272 full-time and 2 part-time employees.
Of these employees, 58 were officers and managers; 142 were employed as operations personnel, including engineers, technicians, draftsman, maintenance and repair persons, meter readers and utility personnel; and 38 were employed in accounting, budgeting, information systems, human resources, customer relations and public relations.
We m ake available free of charge through our website our Code of Ethics, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports, our Corporate Governance Guidelines, and our Board Committee Charters as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission, or the SEC.
We have been affected and could continue to be further affected, by supplier delays and increased costs, due to the impacts of inflation, tariffs, recession, wars and international conflicts, and/or other macroeconomic factors, which are outside of our control and could affect our results of operations.
The impact of any regulatory requirement changes is unpredictable, and could materially and adversely affect our business, financial position and results of operations.
We may be adversely affected by climate variability or by regulatory, legal or market responses to such change.
Climate variability may cause negative impacts to our business if an unexpectedly severe weather event or natural disaster damages our facilities and/or operations or those of our suppliers or independent contractors in our service areas, or from the unintended consequences of regulatory changes that directly or indirectly impose substantial restrictions on our activities or adaptation requirements.
Potential climate variability challenges include the following: increased frequency and duration of droughts, increased precipitation and flooding, increased frequency and severity of storms and other weather events, potential degradation of water quality, unexpected changes in temperature, possible increases in ocean levels, disruptions in water or wastewater services to our customers, decreases in available water supply, extreme changes in water usage patterns and related revenue, increases in expenditures to repair any damages, increases in costs to reduce risks associated with significant weather events or natural disasters, and increases in costs to improve the reliability of our water and wastewater systems and facilities.

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Gone since FY2024

Substantial portions of Delaware, particularly outsid e of northern New Castle County, are not served by a public water or wastewater system and represent potential opportunities for Artesian Water and Artesian Wastewater to obtain new exclusive franchised service areas.
We hold Certificates of Public Convenience and Necessity, or CPCNs, for approximately 310 square miles of exclusive water service territory, most of which is in Delaware with some territory being in Maryland and Pennsylvania.
Our largest connected regional water system, consisting of approximately 145 square miles and 80,100 metered customers, is located in northern New Castle County and portions of southern New Castle County, Delaware.
Artesian Water produced approximately 81.6% of our 2024 consolidated operating revenues.
In May 2022, Artesian Water completed its purchase of substantially all of the water operating assets from the Town of Clayton, or Clayton, a Delaware municipality located in Kent County, Delaware.
This purchase agreement is discussed further in the “Strategic Direction and Recent Developments” section.
We derive about 92% of our self-supplied groundwater from wells that pump groundwater from aquifers and other formations located in the Atlantic Coastal Plain.
The remaining 8% of our groundwater supply comes from wells in the Piedmont Province.
We have 62 different water treatment facilities in our Delaware systems.
Nearly 95% of the overall 9.4 billion gallons of water we distributed in all of our Delaware systems during 2024 came from our groundwater wells, while the remaining 5% came from interconnections with other utilities and municipalities.
In Delaware in 2024, we pumped an average of 24.9 million gallons per day, or mgd, from our groundwater wells and obtained an average of approximately 0.9 mgd from interconnections.
In Delaware, we have 24 interconnections with three neighboring water utilities and seven municipalities that provide us with the ability to purchase or sell water.
As of December 31, 2024, we were serving customers through approximately 1,491 miles of transmission and distribution mains.
Artesian Water Maryland owns and operates 10 public water systems.
The majority of the 0.1 billion gallons of water we distributed in all of our Maryland systems during 2024 came from our groundwater wells, while a portion came from treated surface water.
TESI owns and operates five wastewater treatment facilities, which, combined, are permitted to treat and/or dispose of approximately 35.2 mgd.
Artesian Utility also offers three protection plans to customers, the Water Service Line Protection Plan, or WSLP Plan, the Sewer Service Line Protection Plan, or SSLP Plan, and the Internal Service Line Protection Plan, or ISLP Plan (collectively, SLP Plan or SLP Plans).
The ISLP Plan enhances available coverage to include water and wastewater lines within customers' residences up to an annual limit.
The office facility consists of approximately 10,000 square feet of office space along with nearly 7,000 square feet of warehouse space.
We have made significant enhancements to existing facilities to effectively treat and remove compounds as required by government agencies, such as ultra violet oxidation treatment, ceramic membrane filtration and carbon filtration.
Water utilities also will be required to meet the new MCLs by April 2029 and to notify the public of any violations of the MCLs as of and after that date.
The Company has installed treatment for PFAS at several wellfields to date and has included installation of treatment at additional locations in 2025 in its capital budget, with any remaining necessary treatment planned to be installed before 2029.
U nder Delaware state laws and regulations, we are required to file applications with DNREC for water allocation permits for each of our operating wells pumping greater than 50,000 gallons per day.
We have 144 operating and 62 observation and monitoring wells in our Delaware systems.
At December 31, 2024, we had allocation permits for 116 wells and had 25 wells that did not require a permit.
We are also subject to water allocation reg ulations that control the amount of water that we can draw from water sources.
We have 14 operating wells and one surface water in-take in our Maryland systems.
In March 2024, the SEC passed rule changes that will require registrants to provide certain climate-related information in their registration statements and annual reports.
The new rules enhance and standardize climate-related disclosures in an effort to provide investors with more consistent, comparable and reliable information about the impact of climate-related risks on registrants.
The rules require disclosure of greenhouse gas (GHG) emissions in annual reports and registration statements.
Additionally, all registrants would be required to provide numerous climate-related disclosures within their financial statements and elsewhere in their filings.
The new rules apply to companies on a phased-in basis, with the first compliance deadline for large accelerated filers required for fiscal year 2025 annual reports filed in 2026.
The next compliance deadline for accelerated filers is required for fiscal year 2026 annual reports filed in 2027.
The Company is currently evaluating the impact of the rule changes.
Employees and Human Capital Resources As of December 31, 2024, we operated with 245 full-time and 4 part-time employees.
Of these employees, 55 were officers and managers; 122 were employed as operations personnel, including engineers, technicians, draftsman, maintenance and repair persons, meter readers and utility personnel; and 36 were employed in accounting, budgeting, information systems, human resources, customer relations and public relations.
We make available free of charge through our website our Code of Ethics, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports, our Corporate Governance Guidelines, and our Board Committee Charters as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission, or the SEC.
We have been affected and could continue to be further affected, by supplier delays and increased costs, due to the impacts of inflation, tariffs, recession, and/or other macroeconomic factors, which are outside of our control and could affect our results of operations.
The impact of any regulatory requirement changes are unpredictable, and could materially and adversely affect our business, financial position and results of operations.
We may be adversely affected by global climate change or by regulatory, legal or market responses to such change.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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