Financial Data and Key Metrics Changes - In 2019, the company experienced a revenue increase of approximately 350%, rising from about $7 million to over $20 million, while net income surged nearly 1000%, increasing from $400,000 to almost $5 million [34][39]. Business Segment Data and Key Metrics Changes - The company generates revenue from two main segments: water utility and land development. The water utility segment includes connection fees and annual usage charges, while the land development segment is focused on the Sky Ranch property, which is expected to yield significant revenue from residential and commercial units [5][10][11]. - The average price for water connection fees is about $26,600, and for sewer connection fees, it is approximately $4,600, totaling around $31,000 per connection [9]. Market Data and Key Metrics Changes - The Denver metropolitan area is experiencing a lack of new Master Planned Communities, with most existing ones being over 90% built out, indicating a timely opportunity for the company to bring new developments online [15][16]. - The company is positioned in an attractive submarket for land development, targeting entry-level buyers with homes priced around $350,000 [13]. Company Strategy and Development Direction - The company aims to leverage its water utility capabilities alongside land development to optimize inventory management and enhance revenue generation [18]. - Future phases of development will include additional residential units and commercial space, with plans to diversify product offerings and engage multiple builders [30]. Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's growth trajectory, citing strong demand from builders and a successful first phase of lot deliveries [20][88]. - The company anticipates delivering the remaining lots in 2020, with a projected revenue of $17 million to $18 million from lot sales [35]. Other Important Information - The company has about $7 million in net operating losses (NOLs) that it plans to utilize, with approximately $2 million remaining after 2019 [55]. - The company is in the process of financing through municipal bonds, which will impact its cash flow and reimbursement for public improvements [76][81]. Q&A Session Summary Question: Can you describe the legal relationship between Pure Cycle and the municipalities regarding reimbursables? - The company acts as a wholesaler of water to a quasi-municipal district, handling all billing and receiving 100% of tap fee revenue and 98% of usage revenue [42]. Question: When do municipalities reimburse the company? - Reimbursements can occur early in financing or after project completion, depending on the assessed value and bond market conditions [46][48]. Question: What is the tax situation regarding loss carry forwards? - The company has about $7 million in NOLs, with plans to utilize approximately $5 million in 2019 and $2 million remaining for future use [55]. Question: What are the expected tap connections for fiscal 2020? - The company expects to achieve around 200 tap connections in fiscal 2020 [50]. Question: How does the interest rate on bonds impact Pure Cycle? - The interest rate affects the municipality's bonding capacity, indirectly impacting the company's reimbursement potential [74].

Pure Cycle Corporation (NASDAQ:PCYO) Q2 2019 Results Earnings Conference Call April 8, 2019 1:00 PM ET Company Participants Mark Harding - President and Chief Executive Officer Conference Call Participants Bill Smith - William Smith and Company William Miller - Hartwell John Rosenberg - Loughlin Water Bill Cunningham - Private Investor Operator Good day ladies and gentlemen and thank you for joining us for this Pure Cycle Corporation's Fiscal Year-ToDate and Second Quarter Ended February 28, 2019 Earnings C ...