Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended May 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission file number 000-08814 PURE CYCLE CORPORATION (Exact name of registrant as specified in its charter) | | 84-0705083 (I ...

Financial Data and Key Metrics Changes - The net income for the nine months ended this year was $4.1 million compared to $3.6 million last year, indicating consistent performance [51] - Cash at the end of the quarter was $26 million, with a diversified banking strategy to mitigate risks [52] - The company reported a significant increase in tap fees from $30,000 to $38,000, reflecting the appreciation of water rights [82][84] Business Segment Data and Key Metrics Changes - The water utility segment saw a strong year with water sales to oil and gas operators reaching almost 263 million gallons [58] - The land development segment is progressing with two phases (2A and 2B) running concurrently, contributing to consistent revenue recognition [60][64] - The single-family rental segment is expanding, with plans for 69 rental homes across various product types, indicating strong demand [26][47] Market Data and Key Metrics Changes - The Denver housing market remains robust, particularly for entry-level homes, with less than 4% of housing products meeting the $400,000 price target [20][44] - There is a noted decline in sales of existing homes due to mortgage lock-in effects, impacting move-up buyers [45] - Traffic at Sky Ranch is consistent, contrasting with national trends of weakening traffic due to rising interest rates [46] Company Strategy and Development Direction - The company is focused on vertical integration, combining land development with water utility services to enhance asset value [108] - The development of the Sky Ranch community is a key strategic initiative, with plans for educational facilities and commercial opportunities [38][14] - The company aims to capitalize on the growing demand for affordable housing in the Denver area, particularly in the entry-level market [44] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the market's normalization despite rising interest rates, indicating a recalibration among buyers [21] - The company is committed to maintaining a sustainable growth pace in the Sky Ranch community, despite market challenges [59] - Management highlighted the long-term value of water rights and the potential for continued revenue generation from water and sewer services [73] Other Important Information - The company is preparing for an Investor Day and has plans for presentations at upcoming conferences [99] - The school at Sky Ranch is set to open with over 400 students, enhancing community value [22] Q&A Session Summary Question: What is the book value of water rights after completing Sky Ranch? - Management indicated that approximately 12% of the total portfolio will be in service, with ongoing revenue from water and sewer services [73][74] Question: How has the market strength affected builders' decisions regarding lot sales? - Management noted that builders are not selling lots back due to strong presales and market conditions, which have improved despite rising interest rates [83][90] Question: What is the spread in rents between detached and townhome products? - The current rent spread is between $2,800 and $3,100, with variations based on the type of unit [81]

Pure Cycle Corporation (NASDAQ:PCYO) Q2 2023 Earnings Conference Call April 13, 2023 8:30 AM ET Company Participants Mark Harding - President and Chief Executive Officer Dirk Lashnits - Vice President of Land Development Kevin McNeill - Chief Financial Officer Conference Call Participants Elliot Knight - Knight Advisors Operator Good morning, everybody, and welcome to the Pure Cycle Corporation's Second Quarter 2023 Earnings call. At this time, all participants are in a listen-only mode. A question-and-answ ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended February 28, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ PURE CYCLE CORPORATION (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation ...

[Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) [Forward-Looking Statements Summary](index=4&type=section&id=Forward-Looking%20Statements_summary) This section outlines the company's forward-looking statements, including plans, financial projections, and associated risks - Key forward-looking statements relate to the development of the **Sky Ranch property**, including the number of units, timing of construction, and anticipated financial results from lot sales and tap fees[8](index=8&type=chunk) - The company identifies significant risks that could impact future performance, including deterioration in the **homebuilding industry**, rising interest rates, population growth changes, supply chain disruptions, and changes in governmental policies[10](index=10&type=chunk) - The company explicitly states it has no obligation to update forward-looking statements, and all such statements are qualified by the cautionary language provided[12](index=12&type=chunk) [PART I. FINANCIAL INFORMATION](index=8&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Consolidated Financial Statements](index=8&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the three months ended November 30, 2022, including balance sheets, statements of operations, statements of shareholders' equity, and cash flows [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheet shows total assets decreased slightly to $128.0 million, while total liabilities decreased and shareholders' equity slightly increased Consolidated Balance Sheet Highlights (in thousands) | Account | Nov 30, 2022 (unaudited) | Aug 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $16,843 | $34,894 | | Investments in U.S. Treasury Bills | $15,113 | $0 | | Total current assets | $33,510 | $37,786 | | Total assets | $128,037 | $129,229 | | Total current liabilities | $9,557 | $10,823 | | Total liabilities | $14,789 | $16,233 | | Total shareholders' equity | $113,248 | $112,996 | [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) Total revenues significantly decreased to $1.3 million from $4.3 million year-over-year, primarily due to a sharp decline in lot sales, leading to a net income of $0.16 million Consolidated Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended Nov 30, 2022 | Three Months Ended Nov 30, 2021 | | :--- | :--- | :--- | | Total revenues | $1,340 | $4,273 | | Lot sales | $513 | $2,945 | | Operating (loss) income | $(1,489) | $1,480 | | Net income | $159 | $1,514 | | Diluted EPS | $0.01 | $0.06 | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash used by operating activities improved to $0.8 million, while investing activities used $17.2 million, primarily for U.S. Treasury Bills, resulting in an $18.1 million decrease in cash Consolidated Statement of Cash Flows Summary (in thousands) | Cash Flow Activity | Three Months Ended Nov 30, 2022 | Three Months Ended Nov 30, 2021 | | :--- | :--- | :--- | | Net cash used by operating activities | $(758) | $(5,954) | | Net cash used by investing activities | $(17,179) | $(2,248) | | Net cash (used) provided by financing activities | $(114) | $1,000 | | Net change in cash, cash equivalents and restricted cash | $(18,051) | $(7,202) | [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes detail the company's investment in U.S. Treasury Bills, the growing note receivable from Sky Ranch CAB, revenue sources, debt obligations, and segment performance - The company invested **$15.1 million** in U.S. Treasury Bills classified as held-to-maturity with maturity dates in March 2023[27](index=27&type=chunk) - The note receivable from the Sky Ranch CAB for reimbursable public improvements, project management fees, and interest grew to **$18.5 million** as of November 30, 2022, up from $17.2 million at the start of the quarter[32](index=32&type=chunk) - During the quarter, the company acquired the remaining obligation related to the 'CAA' for **$0.1 million** in cash, resulting in a recorded gain of **$0.2 million**[57](index=57&type=chunk) Significant Customer Revenue Concentration | Customer/Group | % of Total Revenue (Q1 FY23) | % of Total Revenue (Q1 FY22) | | :--- | :--- | :--- | | Sky Ranch homes and Sky Ranch CAB | 19% | 12% | | Two oil & gas operators | 15% | 10% | | KB Home | 13% | 16% | | Lennar | 9% | 25% | | Challenger | 9% | 23% | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the housing market's deterioration, an 89% decrease in net income, and the company's diversified business strategy and sufficient liquidity [Recent Developments and Economic Conditions](index=28&type=section&id=Recent%20Developments%20and%20Economic%20Conditions) The housing market rapidly deteriorated in Q3 2022 due to inflation and rising interest rates, leading to delayed construction at Sky Ranch, though long-term fundamentals remain positive - The housing market deteriorated rapidly in Q3 2022, caused by inflation and rising mortgage rates, leading many buyers to pause home purchases[86](index=86&type=chunk) - In response to market conditions, the company has delayed the start of construction on Phase 2B of the Sky Ranch development to avoid incurring costs amid declining demand[87](index=87&type=chunk) [Our Business Strategy](index=30&type=section&id=Our%20Business%20Strategy) The company operates a cohesive business model across Water and Wastewater, Land Development, and Single-Family Rentals, with plans to expand its rental portfolio at Sky Ranch - The company's primary land asset, **Sky Ranch**, is being developed into a master-planned community with up to **3,200 homes** and over **two million square feet** of commercial space[99](index=99&type=chunk) - Construction on Phase 2A of Sky Ranch (**229 lots**) is approximately **80% complete** as of the report date, with contracts to sell **804 lots** in the second development phase and **46 lots** retained for its single-family rental business[102](index=102&type=chunk)[105](index=105&type=chunk) - The company is expanding its single-family rental business, with **3 homes leased**, **1 completed** in December 2022, and **10 more under construction** in Phase 2A, expected to be ready for rental throughout fiscal 2023[108](index=108&type=chunk) [Results of Operations](index=34&type=section&id=Results%20of%20Operations) Net income for Q1 FY23 decreased by 89% to $0.2 million, primarily due to an 83% drop in lot sales and a 26% decline in water and wastewater revenue, partially offset by increased other income Consolidated Results of Operations (in thousands) | Metric | Three Months Ended Nov 30, 2022 | Three Months Ended Nov 30, 2021 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total revenue | $1,340 | $4,273 | $(2,933) | (69)% | | Lot sales | $513 | $2,945 | $(2,432) | (83)% | | Total cost of revenue | $1,326 | $1,383 | $(57) | (4)% | | Net income | $159 | $1,514 | $(1,355) | (89)% | - Water and wastewater tap sales declined from **9** in Q1 FY22 to **4** in Q1 FY23 due to the timing of home closings and building permit applications at Sky Ranch[117](index=117&type=chunk)[120](index=120&type=chunk) - Land development segment operating income plummeted to **$0.3 million** from **$2.7 million** year-over-year, reflecting the slowdown in construction activities at Sky Ranch[124](index=124&type=chunk) [Liquidity, Capital Resources and Financial Position](index=39&type=section&id=Liquidity%2C%20Capital%20Resources%20and%20Financial%20Position) The company maintains $24.0 million in working capital, including $16.8 million in cash and $15.0 million in treasury notes, deemed sufficient for the next 12 months, with significant future capital commitments for Sky Ranch development and rental units - The company has working capital of **$24.0 million** as of November 30, 2022, and believes it is sufficient to fund operations for the next 12 months[127](index=127&type=chunk) - Future capital needs include completing the **$65.0 million** second phase of Sky Ranch, with **$18.8 million** expected to be spent in the next 12 months, and an additional **$1.8 million** to complete contracted single-family rental units[128](index=128&type=chunk)[131](index=131&type=chunk) Summary Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended Nov 30, 2022 | Three Months Ended Nov 30, 2021 | | :--- | :--- | :--- | | Operating activities | $(758) | $(5,954) | | Investing activities | $(17,179) | $(2,248) | | Financing activities | $(114) | $1,000 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that this item is not applicable - No quantitative or qualitative disclosures about market risk are provided as the company deems them not applicable[139](index=139&type=chunk) [Item 4. Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of November 30, 2022, with no material changes to internal control over financial reporting - The President and CFO concluded that the company's disclosure controls and procedures were effective as of November 30, 2022[141](index=141&type=chunk) - No material changes were made to internal control over financial reporting during the quarter[142](index=142&type=chunk) [PART II. OTHER INFORMATION](index=43&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 6. Exhibits](index=43&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, primarily consisting of certifications by the principal executive and financial officers and Inline XBRL documents - Exhibits filed include Sarbanes-Oxley Act certifications (Sections 302 and 906) and Inline XBRL instance and taxonomy documents[144](index=144&type=chunk) [Signatures](index=44&type=section&id=SIGNATURES) [Signatures Summary](index=44&type=section&id=Signatures_summary) The report is duly signed on behalf of Pure Cycle Corporation by Kevin B. McNeill, Vice President and Chief Financial Officer, on January 13, 2023 - The Form 10-Q was signed by Kevin B. McNeill, Vice President and Chief Financial Officer, on January 13, 2023[149](index=149&type=chunk)

Financial Performance - Diluted EPS was $0.24 [1], corresponding to a net income of $6 million [1] - Revenue for Q1 2023 was $1.34 million [9], a decrease compared to $4.273 million in Q1 2022 [9] - Net income for the three months ended November 30, 2022, was $159,000 [9], significantly lower than the $1.514 million for the same period in 2021 [9] Balance Sheet - As of November 30, 2022, the company had $16.843 million in cash and cash equivalents [7] - Investments totaled $15 million as of November 30, 2022 [7] - Total assets amounted to $128.037 million as of November 30, 2022 [7] Land Development & Water Assets - The company owns 29,900+ acre-feet of water rights [34, 49] - Water assets are valued at $67.4 million [20] - Phase 2A of Sky Ranch development is 78% complete [20] and Phase 2B is 15% complete [20] Stock Repurchase Program - The board approved a stock repurchase program authorizing the CEO and CFO to repurchase up to 200,000 shares [4]

Pure Cycle Corporation (NASDAQ:PCYO) Q1 2023 Earnings Conference Call January 10, 2023 8:30 AM ET Company Participants Mark Harding - President, Chief Executive Officer Kevin McNeill - Vice President, Chief Financial Officer Dirk Lashnits - Vice President, Director of Land Development Conference Call Participants Robert Howard - Boiling Point Resources Bill Cunningham - Private investor Bill Miller - Private investor Operator Good morning and welcome to Pure Cycle Corporation’s first quarter 2023 earnings c ...

Pure Cycle Corporation (NASDAQ:PCYO) Q4 2022 Earnings Conference Call November 15, 2022 8:30 AM ET Company Participants Mark Harding - President, CEO & Director Dirk Lashnits - VP, Land Development Conference Call Participants Bill Miller - Investor Geoffrey Scott - Scott Asset Management John Rosenberg - Lachlan Water Elliot Knight - Knight Advisors Operator Good morning, ladies and gentlemen, and welcome to the Pure Cycle Corporation Year ended 2022 Earnings Call. [Operator Instructions]. It is now my ple ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended August 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-8814 PURE CYCLE CORPORATION (Exact name of registrant as specified in its charter) Colorado 84-0705083 (State or other jurisdiction of incorporation or organization) ( ...

NASDAQ: PCYO www.purecyclewater.com @PureCycleCorp PURE CYCLE CORPORATION EARNINGS PRESENTATION FOR THE THREE AND NINE MONTHS ENDED MAY 31, 2022 ll COMPANY OVERVIEW WATER & WASTEWATER L AND DEVELOPMENT ,0% SINGLE FAMILY, MNG RENTALS 0.09 0.0% FINANCIAL RESULTS Presented by Mark Harding, CEO | Kevin McNeill, CFO | Dirk Lashnits, VP Land Development 1. | --- | --- | --- | |-------|---------------------------------------------------------------------------------------------------------------------------------- ...