Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 10, 2024

PURE CYCLE CORPORATION

(Exact name of registrant as specified in its charter)

Colorado

(State or other jurisdiction of incorporation)


0-8814		84-0705083
(Commission File Number)		(IRS Employer Identification No.)

34501 East Quincy Avenue, Building 65, Suite A, Watkins, CO 80137

(Address of principal executive offices) (Zip Code)


Registrant’s telephone, including area code	(303) 292-3456

N/A

(Former name or former address, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:


Common Stock 1/3 of $.01 par value	PCYO	The NASDAQ Stock Market
(Title of each class)	(Trading Symbol(s))	(Name of each exchange on which registered)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth Registrant as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth Registrant ☐

If an emerging growth Registrant, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

This current report on Form 8-K is filed by Pure Cycle Corporation (Registrant), a Colorado corporation, in connection with the matters described herein

Item 2.02 Results of Operations and Financial Condition.

On July 10, 2024, the Registrant issued a press release announcing its financial results for the three and nine months ended May 31, 2024. A copy of the press release is furnished as Exhibit 99.1 hereto, and in incorporated herein by reference.

In accordance with General Instruction B.2 of Form 8-K, the press release furnished as Exhibit 99.1 to this current report on Form 8-K shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information or exhibit be deemed incorporated by reference into any filing under the Securities Act of 1933 or Securities Exchange Act of 1934, except as shall be expressly set forth by specific reference in any such filing.

Item 7.01Regulation FD Disclosure

On July 11, 2024, the Registrant presented and posted on its website a presentation summarizing Pure Cycle’s operations and financial results (Earnings Presentation). The Earnings Presentation is furnished as Exhibit 99.2 to this Form 8-K and is incorporated herein by reference.

The information contained in the Earnings Presentation is summary information and should be read in conjunction with Pure Cycle’s filings with the Securities and Exchange Commission and other public announcements that Pure Cycle may make by press release or otherwise from time to time. The Earnings Presentation will be posted in the Investor Relations section of Pure Cycle’s website, www.purecyclewater.com.

The information contained in this Item 7.01 of Form 8-K, including the accompanying Exhibit 99.2 is being furnished, and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise subject to the liabilities of that section. The information contained in the presentation shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01Financial Statements and Exhibits.

(d)Exhibits


Exhibit No.		Description
99.1		Press Release dated July 10, 2024, announcing earnings for the three and nine months ended May 31, 2024
99.2		Three and nine months ended May 31, 2024 earnings presentation
104		Cover Page Interactive Data File (the cover page XBRL tags are embedded in the inline XBRL document)

SIGNATURE

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 hereunto duly authorized.

Date: July 11, 2024

Vice
	PURE CYCLE CORPORATION


	By:	/s/ Marc S. Spezialy
		Marc S. Spezialy
		Vice President and Chief Financial Officer

Exhibit 99.1

Pure Cycle Announces Financial Results

For the Three and Nine Months Ended May 31, 2024

DENVER, CO / ACCESSWIRE / July 10, 2024 – Pure Cycle Corporation (NASDAQ Capital Market: PCYO) announced its financial results for the three and nine months ended May 31, 2024. Pure Cycle posted its twentieth consecutive fiscal quarter with positive net income. Pure Cycle continues to develop its Sky Ranch Master Planned Community, and as of May 31, 2024, we are actively working on Phase 2A, 2B and 2C. Phase 2B will be ready for builders to start construction in the coming months and builders will be able to continue into Phase 2C once Phase 2B is built out. We recognized a 52% increase in lot sales revenue for the three months ended May 31, 2024, and a 56% increase in lot sales revenue for the nine months ended compared to 2023, due to an increase in our development activity.

Q3 and YTD 2024 Highlights

Revenues for the three and nine months ended May 31, 2024 of $7.6 million and $16.2 million, which drove pre-tax income of $3.9 million and $6.8 million;

Net income for the three and nine months ended May 31, 2024 of $2.8 million and $5.0 million;

EBITDA for the three and nine months ended May 31, 2024 of $4.5 million and $8.7 million (see table below for reconciliation of net income to EBITDA);

Cash & cash equivalents totaled $20.4 million at May 31, 2024;

For the three and nine months ended May 31, 2024, we delivered 394 and 1,422 acre-feet of water.

Net Income to EBITDA Reconciliation

We continue our profitability as shown in the table below:


	Three Months Ended				Nine Months Ended
(In thousands)	May 31, 2024		May 31, 2023		May 31, 2024		May 31, 2023
Net Income	$	2,825	$	3,295	$	5,008	$	3,643
Add back:
Interest expense, net		109		52		328		149
Taxes		1,027		1,124		1,805		1,344
Depreciation / amortization		561		518		1,579		1,594
EBITDA	$	4,522	$	4,989	$	8,720	$	6,730

Earnings per common share - basic and diluted
Basic	$	0.12	$	0.14	$	0.21	$	0.15
Diluted	$	0.12	$	0.14	$	0.21	$	0.15

Weighted average common shares outstanding:
Basic		24,087,170		24,054,843		24,085,578		24,021,582
Diluted		24,143,039		24,166,344		24,146,361		24,131,621

“Due to the continued success of our Sky Ranch Master Planned community, we now have three phases of lot development under construction accelerating the timing of delivering our lots to home builder customers as well as lots for our single-family rental segment. As we complete final landscaping in Phase 2A, lot production has accelerated deliveries in the remaining half of our fiscal year with completion of approximately 211 lots in Phase 2B and substantial progress on our overlapping production of 228 lots in Phase 2C” commented Mark Harding, CEO of Pure Cycle. “Also contributing were record 2024 YTD water sales to oil and gas customers with a continued strong outlook for the rest of 2024 and into 2025,” continued Mr. Harding.

Q3 and YTD 2024 Financial Summary

Revenue

For the three months ended May 31, 2024, and 2023, we reported total revenues of $7.6 million and $6.9 million with $2.5 million and $3.6 million being generated in our water and wastewater resource development segment, $5.0 million and $3.2 million generated by our land development segment, and $0.1 million and less than $0.1 million reported in our single-family rental business.

For the nine months ended May 31, 2024, and 2023, we reported total revenues of $16.2 million and $11.2 million with $7.6 million and $5.9 million being generated in our water and wastewater resource development segment, $8.3 million and $5.2 million generated by our land development segment, and $0.4 million and less than $0.1 million reported in our single-family rental business.

For the three months ended May 31, 2024, and 2023, we sold 20 and 44 water or water and wastewater taps for $0.6 million and $1.3 million. For the nine months ended May 31, 2024, and 2023, we sold 35 and 85 water or water and wastewater taps for $1.1 million and $2.4 million. We have sold 741 water and wastewater taps at Sky Ranch in Phases 1, 2A and 2B. Based on current prices and engineering estimates, we believe Phase 2 of Sky Ranch will exceed $20.0 million in additional water and wastewater tap fee revenue and cash over the next three to five years.

As of May 31, 2024, the first development phase (509 lots) is complete and the second development phase (874 lots) is being developed in four subphases, referred to as Phase 2A (229 lots), Phase 2B (211 lots), Phase 2C (228 lots) and Phase 2D (206 lots). As of May 31, 2024, Phase 2A is approximately 98% complete, Phase 2B is approximately 70% complete and Phase 2C is approximately 21% complete. Phase 2A is substantially completed with some landscaping items remaining. Phase 2B is expected to be complete by the end of Pure Cycle’s fiscal 2024 and Phase 2C is expected to be complete during Pure Cycle’s fiscal 2025.

As of May 31, 2024, the single-family rental business had 14 homes built and rented in Sky Ranch and 17 additional homes forecasted for construction in Phase 2B. As noted in the prior quarters, due to the overwhelming demand for rental homes at Sky Ranch, we expect to have a total of 93 homes in Phase 2 with the ability to add more than 200 homes as Sky Ranch builds out.

“As expected, our land development activity has ramped up in the third quarter which we expect will continue into fiscal 2025 with multiple phases under development,” commented Marc Spezialy, CFO of Pure Cycle. “New home sales remain high, and we are excited to be able to offer an affordable housing product to builders in our Sky Ranch Master Planned Community. We are also preparing to begin construction in the fourth quarter on our next phase of single-family rentals, which will more than double the number of units we have to rent once Phase 2B is completed,” concluded Mr. Spezialy.

Working Capital

We reported working capital (current assets less current liabilities) of $19.6 million as of May 31, 2024, with $20.4 million of cash and cash equivalents.

Q3 and YTD 2024 Operational Summary

Water and Wastewater Resource Development

Water deliveries decreased for the three months ended May 31, 2024, from 394 acre-feet delivered as compared to 564 acre-feet delivered in Q3 2023, primarily due to an unusually large volume of oil and gas water sales in Q3 2023. Water deliveries increased for the nine months ended May 31, 2024, to a record 1,422 acre-feet delivered as compared to 806 acre-feet delivered in the same period of 2023. Oil and gas operations are highly variable and dependent on oil prices, demand for gas, and timing of development of other leases in our service areas; however, our current expectation is for continued strong demand for oil and gas water sales through 2024 and 2025. As Sky Ranch continues to develop, we anticipate continued growth in our residential water and wastewater service revenues. Water and wastewater tap sales decreased in Q3 2024 and YTD 2024 compared to the same period in 2023 due to the timing of closings at Sky Ranch. Tap sales are driven by building permit applications and are not contractually established with the builders.

Land Development

Lot sales revenue increased to $4.8 million for the three months ended May 31, 2024 compared to $3.2 million in 2023. Lot sales revenue increased to $7.9 million for the nine months ended May 31, 2024 compared to $5.1 million in 2023. Increases in the quarter and year to date lot sales revenue are due to the timing of construction in Sky Ranch on Phase 2A, 2B and 2C. Because lot sales revenue is recognized as construction progresses, revenue will fluctuate due to timing of construction activities.

Single Family Rentals

Q1 2024 represented our first quarter of rental income for our 14 completed homes. An additional 17 homes are forecasted for construction in Phase 2B in calendar 2024.

Earnings Call Information

Pure Cycle will host a conference call on Thursday July 11, 2024, at 8:30AM Eastern (6:30AM Mountain) to discuss the financial results and answer questions. Call details are presented below. We will post a detailed slide presentation on our website, which will provide an overview of Pure Cycle and present summary financial results and can be accessed at www.purecyclewater.com.

When: 8:30AM Eastern (6:30AM Mountain) on July 11, 2024

Call in number: 888-506-0062 (access code: 435023)

International call-in number: 973-528-0011 (access code: 435023)

Replay numbers: 877-481-4010 | 919-882-2331 (passcode: 50832)

Replay available until: July 25, 2024 at 8:30AM ET

Event link: https://www.webcaster4.com/Webcast/Page/2247/50832

Other Important Information

The table below presents our consolidated results of operations for the three and nine months ended May 31, 2024 and 2023 (unaudited):


	Three Months Ended				Nine Months Ended
(In thousands, except share information)	May 31, 2024		May 31, 2023		May 31, 2024		May 31, 2023
Revenues:
Metered water usage from:
Municipal customers	$	145	$	145	$	458	$	349
Commercial customers		1,432		2,145		5,045		2,596
Wastewater treatment fees		85		75		258		216
Water and wastewater tap fees		581		1,256		1,162		2,400
Lot sales		4,795		3,160		7,906		5,064
Project management fees		221		42		362		173
Single-family rentals		123		34		357		90
Special facility projects and other		222		22		639		330
Total revenues		7,604		6,879		16,187		11,218

Cost of revenues:
Water service operations		564		576		1,628		1,457
Wastewater service operations		173		96		513		350
Land development construction costs		1,192		951		1,961		1,291
Project management costs		154		81		401		227
Single-family rental costs		71		24		161		53
Depletion and depreciation		410		407		1,132		1,246
Other		174		71		406		318
Total cost of revenues		2,738		2,206		6,202		4,942

General and administrative expenses		1,647		805		5,082		3,900
Depreciation		151		111		447		348
Operating income		3,068		3,757		4,456		2,028

Other income (expense):
Interest income - related party		217		331		1,156		841
Interest income - Investments		279		281		873		727
Oil and gas royalty income, net		392		44		479		227
Oil and gas lease income, net		18		18		56		56
Other, net		(13)		40		121		1,257
Interest expense, net		(109)		(52)		(328)		(149)
Income from operations before income taxes		3,852		4,419		6,813		4,987
Income tax expense		(1,027)		(1,124)		(1,805)		(1,344)
Net income	$	2,825	$	3,295	$	5,008	$	3,643

Earnings per common share - basic and diluted
Basic	$	0.12	$	0.14	$	0.21	$	0.15
Diluted	$	0.12	$	0.14	$	0.21	$	0.15
Weighted average common shares outstanding:
Basic		24,087,170		24,054,843		24,085,578		24,021,582
Diluted		24,143,039		24,166,344		24,146,361		24,131,621

The following table presents our consolidated financial position as of May 31, 2024 (unaudited) and August 31, 2023 (audited):


(In thousands, except shares)	May 31, 2024		August 31, 2023
ASSETS:		(unaudited)
Current assets:
Cash and cash equivalents	$	20,360	$	26,012
Short term investments		171		—
Trade accounts receivable, net		2,303		1,092
Land under development		5,183		1,726
Income taxes receivable		—		551
Prepaid expenses and other assets		580		346
Total current assets		28,597		29,727
Restricted cash		2,881		2,475
Investments in water and water systems, net		59,078		57,798
Construction in progress		4,243		5,457
Single-family rental units		5,115		4,490
Land and mineral rights:
Held for development		3,714		4,652
Held for investment purposes		451		451
Other assets		1,167		1,359
Notes receivable – related parties, including accrued interest
Reimbursable public improvements and project management fees		33,541		24,999
Other		1,441		1,451
Operating leases - right of use assets		176		357
Total assets	$	140,404	$	133,216

LIABILITIES:
Current liabilities:
Accounts payable	$	3,311	$	1,960
Accrued liabilities		1,380		1,761
Accrued liabilities – related parties		1,357		1,021
Income taxes payable		1,383		—
Deferred lot sales revenues		1,548		1,661
Deferred water sales revenues		13		69
Debt, current portion		34		31
Total current liabilities		9,026		6,503
Debt, less current portion		6,859		6,885
Deferred tax liability, net		1,230		1,352
Lease obligations - operating leases, less current portion		106		242
Total liabilities		17,221		14,982
Commitments and contingencies
SHAREHOLDERS’ EQUITY:
Series B preferred shares: par value $0.001 per share, 25 million authorized; 432,513 issued and outstanding (liquidation preference of $432,513)		—		—
Common shares: par value 1/3 of $.01 per share, 40.0 million authorized; 24,075,342 and 24,078,720 outstanding, respectively		80		80
Additional paid-in capital		175,069		174,689
Accumulated deficit		(51,966)		(56,535)
Total shareholders’ equity		123,183		118,234
Total liabilities and shareholders’ equity	$	140,404	$	133,216

Company Information

Pure Cycle continues to grow and strengthen its operations, grow its balance sheet, and drive recurring revenues. We operate in three distinct business segments, each of which complements the other. At our core, we are an innovative and vertically integrated wholesale water and wastewater service provider. In 2017, we launched our land development segment which develops master planned communities on land we own and to which we provide water and wastewater services. In 2021, we launched our newest line of business, the rental of single-family homes located at Sky Ranch, which provides long-term recurring revenues, furthers our land development operations, and adds more customers to our water resource segment.

Additional information, including our recent press releases and SEC filings, is available at www.purecyclewater.com, or you may contact our President, Mark W. Harding, or our CFO, Marc Spezialy, at 303-292-3456 or info@purecyclewater.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are all statements, other than statements of historical facts, included in this press release that address activities, events or developments that we expect or anticipate will or may occur in the future, such as statements about the following: our positioning to continue to grow through this market cycle; the completion and delivery of our rental units; timing of development at Sky Ranch; future water and wastewater tap sales and revenues; future home sales by our home builder customers; the affordability of our products; the strength of the Sky Ranch market; forecasts about our fiscal 2024 sales of water to oil and gas operators; our sales of lots; and our expected financial results. The words "anticipate," "likely," "may," "should," "could," "will," "believe," "estimate," "expect," "plan," "intend" and similar expressions are intended to identify forward-looking statements. Investors are cautioned that forward-looking statements are inherently uncertain and involve risks and uncertainties that could cause actual results to differ materially. Factors that could cause actual results to differ from projected results include, without limitation: home mortgage interest rates, inflation, and other factors impacting the housing market and home sales; the risk factors discussed in Part I, Item 1A of our most recent Annual Report on Form 10-K for the fiscal year ended August 31, 2023; and those factors discussed from time to time in our press releases, public statement and documents filed or furnished with the U.S. Securities and Exchange Commission. Except as required by law, we disclaim any obligation to update publicly any forward-looking statements, whether because of new information, future events or otherwise.

SOURCE: Pure Cycle Corporation

Exhibit 99.2

NINE MONTHS ENDED 5/31/2024 PRESENTATION PURE CYCLE CORPORATION Presented by: Mark Harding Exhibit 99.2

Statements that are not historical facts contained or incorporated by reference in this presentation are “forward-looking statements” (“FLS”) within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21C of the Securities Exchange Act of 1934 as amended. FLS involve risks and uncertainties that could cause actual results to differ from projected results. The words “anticipate,” “believe,” “estimate,” “expect,” “plan,” “intend” and similar expressions, as they relate to us, are intended to identify FLS. Such statements reflect our current views with respect to future events and are subject to certain risks, uncertainties and assumptions. We are not able to predict all factors that may affect future results. We cannot assure you that any of our expectations will be realized. Our actual results could differ materially from those discussed in or implied by these forward-looking statements. Factors that may cause actual results to differ materially from those contemplated by such FLS include, without limitation: the risk factors discussed in our most recent Annual Report on Form 10-K; the timing of new home construction and other development in the areas where we may sell our water, which in turn may be impacted by credit availability; population growth; employment rates; general economic conditions; the market price of water; changes in customer consumption patterns; changes in applicable statutory and regulatory requirements; changes in governmental policies and procedures; uncertainties in the estimation of water available under decrees; uncertainties in the estimation of costs of delivery of water and treatment of wastewater; uncertainties in the estimation of the service life of our systems; uncertainties in the estimation of costs of construction projects; uncertainties in the amount and timing of reimbursable public improvement payments: uncertainty in the single family home rental market and our ability to rent homes in a timely manner or at the amount we project; the strength and financial resources of our competitors; our ability to find and retain skilled personnel; climatic and weather conditions, including flood, droughts and freezing conditions; labor relations; availability and cost of labor, material and equipment; delays in anticipated permit and construction dates; environmental risks and regulations; our ability to raise capital; our ability to negotiate contracts with new customers; and uncertainties in water court rulings; and other factors discussed from time to time in our press releases, public statements and documents filed or furnished with the SEC. FORWARD-LOOKING STATEMENTS PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 , 2024 PG. 22 st

OUR STRATEGIES OUR PERFORMANCE ASSETS TRAJECTORY IMPORTANT UPDATES QUARTERLY REVIEW: Q3-2024 RESULTS 1 2 3 4 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 3

Visionary Leadership of a Strong and Dedicated Team REFLECTING ON OUR STRATEGIES LEADERSHIP & DEDICATED TEAM STRONG DIVERSIFIED BOARD WITH DECADES OF INDUSTRY EXPERIENCE COMPLIMENTARY SEGMENTS STRATEGIC INVESTMENT AND STRONG ASSET PORTFOLIO

EFFECTIVE LEADERSHIP DIRK LASHNITS Vice President, Land Development Dirk is a seasoned leader with a Civil Engineering background and over two decades of local land development experience. He skillfully guides land development, entitlements, and construction, playing a vital role in advancing corporate objectives, risk management, and project success. RACHELLE BEAUDRY Head of Marketing SCOTT LEHMAN Vice President, Engineering Scott brings four decades of experience as a Professional Engineer (PE) to the role. His expertise encompasses planning, design, construction, and operation of water and wastewater systems. With educational foundations from the University of Colorado and Stanford University, he plays a pivotal role in shaping our strategies and operations in this vital sector. MARC SPEZIALY VP, CFO, Principal Accounting Officer, Principal Financial Officer Marc brings over 20 years of financial expertise. He manages our financial operations and single-family rentals. Marc obtained his bachelor's degree in Accounting and Finance from the University of San Francisco and is a licensed Certified Public Accountant. MARK W. HARDING President, CEO, and Director Mark is an exceptional leader who has significantly shaped Pure Cycle's success. Under his 34 year tenure, the company has successfully acquired over $130 million in water and land interests. His vision and strategic acumen have been instrumental in the company's growth and impact. PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 5

Own nearly 30K acre-feet of water rights (surface and ground water) Sustainable water rights we estimate can serve up to 60,000 SFEs Denver metro land development requires developers to have water service as a condition of zoning, offering us a competitive edge Provide industrial and oil and gas customers with water Own and reuse our reclaimed water Own highly-appreciated property in attractive and easily accessible I-70 Corridor of Denver, Colorado Developing nearly 930 acres of a full Master Planned community known as Sky Ranch Sky Ranch can have around 3,200 residential units and over 2 million square feet of retail, commercial and industrial uses (Equivalent of 1,800 residential units) Developing residential and commercial land for which we are the sole water and wastewater service provider Build single family homes in the Denver metro area in neighborhoods we are developing Receive rental income in growing housing market Benefit from immediate asset appreciation and positive cash flows Provide water and wastewater service to rental properties Water and Wastewater Resource Development Segment Land Development Segment Single-Family Home Rentals WATER & WASTEWATER LAND DEVELOPMENT RENTALS SINGLE-FAMILY WE OPERATE MULTIPLE COMPLIMENTARY SEGMENTS PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 6

STRONG ASSET PORTFOLIO WATER/WASTEWATER $40m in Water Systems $9.2m in Waste Water Systems $14.6m Water Rights Portfolio Our water rights portfolio can provide water to as many as 60,000 connections. This would allow ample room for growth within our current water system, which presently supports roughly 2,500 connections. LAND DEVELOPMENT SINGLE FAMILY RENTALS $5.2m of Land for Development $3.7m developed land for sale $1.4m other assets Land used for developing the 930 acre Sky Ranch Community which can accommodate up to 3,200 residential lots and up to 2M sq. ft. of commercial development 15 miles east of downtown Denver and 4 miles south of DIA Pure Cycle contracts to build single family homes in its Sky Ranch Master Planned Community to hold for rentals. Lot development costs fully recovered (horizontal costs and tap fees) Each unit covers financing costs and provides positive cash flows Segment provides excellent asset appreciation positive cash flows. $64m Total Water Assets $5.4m in Construction Cost $7.2m in Fair Market Value $10.3m Total Assets LIQUIDITY $20.5m in Cash and ST Invest $2.9m in Restricted Cash $33.5m in Receivable from CAB Pure Cycle has a strong balance sheet with liquidity to support our business segments. Pure Cycle maintains a significant cash position as well as a receivable from the Sky Ranch CAB for approved reimbursements for public improvement that were paid for by Pure Cycle. The receivable bears interest at a rate of 6% per annum. $56.9m Total Liquidity $6.9m in Total Debt PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 , 2024 PG. 7 st

MAJOR LEARNINGS FINANCIAL RESULTS PERFORMANCE METRICS Financial Results and Key Performance Indicators MEASURING OUR PERFORMANCE st

Financial Results Q3-2022 Q3-2023 Q3-2024 $0 $5,000 $10,000 $15,000 $20,000 Q3-2022 Q3-2023 Q3-2024 $0 $2,000 $4,000 $6,000 $8,000 $10,000 Revenue (000's) Gross Profit (000's) $9,985 $16,187 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 9

Financial Results Q3-2022 Q3-2023 Q3-2024 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 Q3-2022 Q3-2023 Q3-2024 $0.00 $0.05 $0.10 $0.15 $0.20 $0.25 Net Income (000's) EPS $5,008 $0.21 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 10

MEASURING OUR PERFORMANCE Land Development 52.7% Water/WasteWater 45.1% Single Family Rental 2.2% REVENUE BY SEGMENT Water/Wastewater Land Development Single Family Rentals Q3-2022 Q3-2023 Q3-2024 0 2000 4000 6000 8000 10000 GROSS PROFIT QOQ BY SEGMENT (000'S) LAND DEV 69% Gross Margin WATER 53% Gross Margin SFR 55% Gross Margin PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 , 2024 PG. 11 st

Actual Projected 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0 1,000 2,000 3,000 4,000 5,000 Water/Wastewater O&G Tap Fees Q3 2022 Q3 2023 Q3 2024 $0 $2000 $4000 $6000 $8000 WATER/WASTEWATER SEGMENT RECURRING CUSTOMER GROWTH 20% Customer CAGR Avg Customer Annual Revenue $1,500 WATER/WASTEWATER SEGMENT REVENUES (000'S) PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 12

Q1 Q2 Q3 Q4 $0 $1,000 $2,000 $3,000 $4,000 $5,000 FY 2024 FY 2023 FY 2022 FY 2021 FY 2020 With existing systems, we are able to provide water to O&G operators. We have also made strategic investments in our system to further our ability to provide water when it is needed, where it is needed in the future. WE PROVIDE RAW WATER TO O&G OPERATORS FOR DRILLING > 150 WELLS DRILLED TO DATE AVERAGE $250,000 OF WATER SALES PER WELL OIL RIG CAN DRILL 60 WELLS PER YEAR WE CAN PROVIDE WATER TO MORE THAN 200 SQUARE MILES IN ADAMS & ARAPAHOE COUNTIES REVENUE (000'S) $4,769 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 13

100% 98% 70% Phase 2b 80.3% Phase 2a 11.1% Other 8.6% Q3-2021 Q3-2022 Q3-2023 Q3-2024 0 2000 4000 6000 8000 10000 22% 0% LAND DEVELOPMENT Phase 1 Phase 2a Phase 2b CURRENT YEAR % REVENUE BY PHASE LAND DEVELOPMENT REVENUE QOQ (000'S) Phase 2c Phase 2d PHASE LOTS SFR LOTS 505 4 219 10 194 17 188 40 180 26 PROGRESS Total 1,286 97 = 1,383 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 14

Land development is substantially complete. Out of 229 homes, 228 are finished and occupied. All paving is complete, and homebuilders are ready to begin construction on homes. Land development is estimated to be completed by the end of the calendar year 2024. Grading is finished, and utility work has begun. Land development is scheduled to be completed by the end of fiscal year 2025. Land development is set to start in fiscal year 2025. PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 15

Homes Rented 14 Book FMV 2022 2023 $0 $2000 $4000 $6000 $8000 Q1-2023 Q2-2023 Q3-2023 Q4-2023 Q1-2024 Q2-2024 Q3-2024 $0 $20 $40 $60 $80 $100 $120 $140 www.purecyclewater.com Pg. 15 SINGLE FAMILY RENTALS BOOK ASSETS & FMV (000'S) Quarterly Rent Revenue $125,000 RENT REVENUE Q/Q (000S) 29% CAGR 14 homes PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 16

SFR Projections Phase 1 (+4 Homes) Phase 2a (+10 homes) Phase 2b (+17 Homes) Phase 2c (+40 Homes) Phase 2d (+26 Homes) Cumulative Homes 4 14 31 71 97 Rental income 131 459 1,017 2,263 3,116 Direct operating costs 48 168 372 828 1,140 Interest and depreciation expense 50 174 384 856 1,178 Net operating income $33.60 $117.60 $260 $580 $798 Add back non-cash items 37 129 285 635 874 Cash flows before G&A & tax $70.40 $246.40 $546 $1,214 $1,672 SFR - Cumulative Pro Forma P&L by Phase (000s) Based on actual results 14 completed homes Sky Ranch Phase 2 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 , 2024 PG. 17 st PROJECTED

Book Assets FMV Phase 1 Phase 2a Phase 2b Phase 2c Phase 2d $0 $10,000 $20,000 $30,000 $40,000 $50,000 Rental Income Cash flows before G&A & tax Phase 1 Phase 2a Phase 2b Phase 2c Phase 2d 0 500 1,000 1,500 2,000 2,500 3,000 3,500 Completed Phases Completed Phases SFR Phase PrOjections Recurring Income Growth (000s) Asset Growth (000s) PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 18

ASSETS TRAJECTORY WATER CUSTOMERS & CAPACITY OIL & GAS INFRASTRUCTURE WATER PRODUCTION CAPACITY TAP FEES - WATER PORTFOLIO LAND DEVELOPMENT PROJECTIONS SINGLE FAMILY RENTAL PROJECTIONS Portfolio Utilization and Projections

Ongoing Housing Deficit: Significant shortage remains despite recent construction efforts, indicating continued high demand. Stable Demand: Tens of thousands of new homes needed even without population growth, ensuring a strong market for developers. Affordability Issues: Only 5.1% of households in Denver can afford to buy, highlighting the need for more affordable housing options. Legislative Support: New Colorado law banning occupancy limits can increase demand for new homes as more individuals establish separate households. Rising Construction Needs: The housing deficit rose from 4.3 million units in 2021 to 4.5 million in 2022, underscoring the urgent need for new housing developments. PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 20

Water & Wastewater WATER PORTFOLIO - 60,000 CONNECTIONS WATER SYSTEMS CAN SERVICE 3,600 TAPS STATE OF THE ART WASTEWATER FACILITY Land Development Single Family Rentals 930 ACRE MASTER DEVELOPMENT UP TO 3,200 RESIDENTIAL LOTS UP TO 2M SQFT OF COMMERCIAL DEVELOPMENT 14 COMPLETED/RENTED HOMES 200 PLANNED HOMES IN SKY RANCH EXPANDING OUR PRODUCT MIX TO INCLUDE: FRONT LOAD DETACHED HOMES PAIRED HOMES ALLEY LOAD HOMES WELL POSITIONED FOR GROWTH Capacity Greater than Utilization PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 , 2024 PG. 21 st

AF Used AF Available Capacity Usage 0 500 1,000 1,500 2,000 2,500 3,000 Acre-foot per Calendar Yr We continue to invest in our systems with a current book value of $40.0 million which can produce over 3.4 million gallons of water per day For Nine Months ended 5/31/2024 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 22

TAP FEES - PORTFOLIO CAPACITY (60,000) At Buildout Current Remaining Capacity Sold To Date We estimate our portfolio can serve approximately 60,000 connections, generating approximately $2.3 billion in revenues based on current rates. To date, we have added around 1,136 connections, representing less than 2% of our overall capacity PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 23

Completed Under Construction Sold Not Started Remaining Residential Commercial Combined 0 200,000 400,000 600,000 800,000 SKY RANCH CAPACITY PROJECTIONS Lot Revenue (000s) Sky Ranch is zoned to accommodate up to 3,200 single- and multi-family homes, and over 2 million square feet of retail, commercial, and light industrial space – which is the equivalent of 1,800 residential lots for a total of 5,000 SFEs 3,200 SFES 1,800 SFES 5,000 SFES With a book value of land at $4.43 million and over $600 million in development revenue poised to monetize in the coming years, exemplifies the understated value on the Company’s balance sheet. PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 24 37% 0% 15%

Future Phases 103 Planned in Phase 83 Completed 14 SINGLE FAMILY RENTALS Strategy is to retain the equity value in the land and water and deliver affordable rental units in our Sky Ranch Master Planned Community Each unit delivers positive cash flows with a 65% LTV On average each unit carries $150,000 fair market value equity roll forward Planned SFR Units (200) To produce $6.7m in Annual Revenue Future Phases 51.5% Planned in Phase 41.5% Completed 7% Units Revenue (in Millions) $ 0.47 $ 3.45 $ 2.78 PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 25

Executing our strategic approach to growing our integrated water utility, land development, and single-family rentals to maximize returns for years to come Strengthening our ability to take advantage of investment opportunities and single-family rentals while systematically developing in land and water Clear path to maximize returns with our large asset portfolio with low cost based assets in each segment allowing us to generate above market returns and substantial organic growth year after year Key Takeaways GROSS MARGIN ROA ASSET CAGR 5 Years 1 1 ROA Calculated Pre-Tax W/ Depreciation added back on Active Segment Assets Annuallized PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 26

IMPORTANT UPDATES Updates and Q&A CORPORATE INFORMATION STOCK REPURCHASE PROGRAM Q&A

Fiscal Period Total Number of Shares Purchased Average Price Paid per Share Q1 2024 20,000 $9.92 Q2 2024 10,000 $9.94 Q3 2024 15,000 $9.48 June 2024 11,880 $9.16 Total 56,880 $9.62 As announced in the press release on November 14, 2022, our board approved an open-ended stock repurchase program which authorizes our CEO and CFO to repurchase up to 200,000 shares in the open market. STOCK REPURCHASE PROGRAM UPDATE PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 28

Board of Directors Mark W. Harding Marc Spezialy Patrick J. Beirne Susan Heitmann Jeffrey G. Sheets Wanda J. Abel Daniel R. Kozlowski Fredrick A. Fendel III. President and CEO Vice President and CFO Chair of the Board Director and Chair of the Audit Committee Director Director Director and Chair of the Compensation Committee Director and Chair of the Nominating and Governance Committee PURE CYCLE CORPORATION RESULTS FOR NINE MONTHS ENDED MAY 31 st, 2024 PG. 29

Q&A PURE CYCLE CORPORATION

Document and Entity Information	Jul. 10, 2024
Document and Entity Information [Abstract]
Document Type	8-K
Document Period End Date	Jul. 10, 2024
Entity File Number	0-8814
Entity Registrant Name	PURE CYCLE CORPORATION
Entity Incorporation, State or Country Code	CO
Entity Tax Identification Number	84-0705083
Entity Address State Or Province	CO
Entity Address, Address Line One	34501 East Quincy Avenue, Building 65, Suite A
Entity Address, City or Town	Watkins
Entity Address, Postal Zip Code	80137
City Area Code	303
Local Phone Number	292-3456
Title of 12(b) Security	Common Stock 1/3 of $.01 par value
Trading Symbol	PCYO
Security Exchange Name	NASDAQ
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Central Index Key	0000276720
Amendment Flag	false