Slide 1: Water & Wastewater Development, Land Development, Financial Results, Oil and Gas Overview
Water & Wastewater Development Land Development Financial Results Oil and Gas Overview 1.
Slide 2: Overview – Forward-looking statements
Overview 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 Securit
Slide 3: Water and Wastewater, Land Development, Single-Family Home Rentals
Water and Wastewater Resource Development Segment • Own a large and valuable portfolio of water rights • Sustainable ground and surface water rights we estimate can serve up to 60,0000 SPEs • Denver metro land development requires developers to have water service as a condition of zoning, offering u
Slide 4: Water and Wastewater Resource Development
............ purecyclewater.com Follow us on Twitter @purecyclecorp 4. ......
Slide 5: Wholesale Water and Wastewater
WHOLESALE WATER AND WASTEWATER Principal business interests are to deliver wholesale water and wastewater service 0 R'RTG7ITfOffRIU E WELLS/DIVERSION Large water portfolio in water-short Denver Company owns or controls 29,000+ acre feet of groundwater & surface water which we estimate can serve 60,0
Slide 6: Water Infrastructure
2 3 Alluvial Wells Storage 150 Acre-Feet of Surface Storage •-<<6 - """""lCastle Rock Tomah Sc roll on mouse to zoom N o '""'-"""-• Ooo<ol-•--e - - --D- - ·-- 6. A·-o - ====.:· ==== o::.-:_ WATER INFRASTRUCTURE
Slide 7: Monthly Water Customers
Monthly Water Customers 5,000 5,000 Growth from: New Residential New service customers added with every neighborhood Avg. residential customer generates $1,500 per year in revenue 4,570 4,500 4,070 4,000 3,570 3,500 3,070 3,000 New Commercial Future Sky Ranch commercial phases 2,570 2,500 2,070 2,00
Slide 8: Development Encroachment to Lowry Range
DEVELOPMENTENCROACHMENTTOLOWRYRANGE ·-- -------r-.·. -_·..-..... - c-..... ---· ........._. 8. llWll!·----=··=-......... c -
Slide 9: Investment in Water and Tap Sales
Sales Water /WW Tap Fees All major infrastructure is in service to support phase 2 of the Sky Ranch Development $6M $5.5M $5M $4.5M $4M $3.5M FY 2021 Water Assets (Net) In millions $3M $2.5M $2M FY2020 FY 2019 $1.5M $1M $0.5M FY2018 0 2019 2020 2021 FY 2017 • $Sold 9. $36.7 $34.6 Investment in Water
Slide 10: Developing the Sky Ranch
+ Developing the 930 acre Sky Ranch an accommodate up to 3,200 sidential lots + Can Accommodate up to 2 million square feet of commercial development (1,800 SFE's) + 15 miles east of downtown Denver south of DI/
Slide 11: Sky Ranch – Phase 1
o All lots delivered (509) o Approximately 375 residents o 467 of 509 Taps Sold o Estimated that homes will be fully sold out by the end of Q2-2022 o Received $10.5 million ofreimbursables and recorded more than $20M in receivables including project management fees and related interest income o Reco
Slide 12: Sky Ranch – Phase 2 Overview
• Approximately 850 lots in total • 804 lots under contract with home builders • 46 lots reserved for rental business with an additionallOO potential plats • Initial lots expected to be delivered late calendar 2021 • Estimated lot revenues of $70 million • Estimated tap fees of $20.9 million • Estim
Slide 13: Sky Ranch Phase 2 Financial and Quantitative Data
SKY RANCH PHASE 2 FinancialAnd Quantitative Data Totallot costs !17.6m) 'Reimbursable costsare public improvements reimbursable from the Sky RanchCommunity Authority Board TOTAllOT SAlES BY BUilDER 28,000,000 TOTAllOTS BY TYPE TOTAllOTS BY BUilDER • 45'LOTS • 45'LOTIS (ALLEY) • 50'LOTS • 35'LOTS • O
Slide 14: Lot Closing Dashboard
1st SUB-PHASE OF 2nd DEVELOPMENT PHASE lOT CLOSING DASHBOARD 11/3012021 18,417,000 000 000 3 Utilities lOT SAlES BY BUilDER lOTS BY TYPE lOTS BY BUilDER 8,000,000 10.04% • 45'LOTS • 45'LOTTS (ALLEY) • 50'LOTS • 35' LOTS • DUPLEXS • CHALLENGER • LENNAR • DR HORTON • KBHOMES • PCYO BTR Lennar Challeng
Slide 15: Single-Family Rentals
We have contracted for the construction of single family homes with the intent to retain them for long-term rental purposes. Pure Cycle is working with experienced home builders to construct these houses, which Pure Cycle will own and maintain, taking on a new role as property manager. "The single-f
Slide 16: Rental Market Report
LEASED LISTINGS -19% Steady increase in lease price while other rental types fell Detached and Townhomes, are more affordable per square foot and per bedroom n..· ..CJt .;.o.t<: MEDIAN LEASED PRICE PER BEDROOM MEDIAN LEASED PRICE PSF _7 oavs MEDIAN DAYS IN MIS +13% +7% Detached homes spend less days
Slide 17: Pro Forma Single House Cash Flow
Pro Forma Single house Monthly Pro forma Single house Annualized 2,820 $ $ Rental Income 33,840 Operations, repairs and maintenance Property taxes and insurance Interest expense Cash flow 150 400 950 1,800 4,800 11,400 1,320 $ $ 15,840 ======:::::i::::::= Assumptions • Rental income is the average a
Slide 18: Per House Estimates
PER HOUSE ESTIMATES $342K $317K $547K Assumptions • Flexible debt usage, up to 70% of appraised value • Low cost capital (3.75%) • House appraisal value estimated at $547,000 based on homes sold in Sky Ranch per NMLS ·Annual appreciation estimated at 4% per year • Estimated construction of 12-20 hom
Slide 19: Phase 1-3 Rental Homes
PHASE 1-3 RENTAL HOMES 3 Units fully occupied! Approval to start date Utilities complete & vertical construction in progress! Final stages of framing 19.
Slide 20: Southern Wattenberg Niobrara
--Southern Wattenberg Niobrara More than 200 square miles in Adams & Arapahoe Counties .!:::. ... ...... -.,_·-..····-_ :·=-··.·..-:: ...... e a.---··-·•"""" Five Possible Formations Pad Development: 40 Acre spacing 16 wells/mile formation Over 10,000 well capacity Average $250,000 per well 120 20.
Slide 21: Fiscal Year 2021 Highlights
FISCAL YEAR 2021 rental line of Business Phase 1 of Sky Ranch is substantially and roughly95% occupied Continued growth despite COVID-19 shutdown from 2020 to date Planned and executed the creation of our new single-family home rental business 21. Completed Sky Ranch Phase 1 Above Market Employee Re
Slide 22: Fiscal Year Ended August 31, 2021
FISCAL YEAR ENDED AUGUST 31, 2021 Gross Margin Revenue Net Income* 22M 20M 18M 16M 14M 12M 10M 8M 6M 4M 2M 0 -2M -4M $26m 26M 24M 22M 20M 18M 16M 14M 12M 11M $11m $20m • 10M $20m 9M 8M $7m $7m 7M $5m $7m 10M FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FYE 2017 FYE 2018 FYE 2019 FYE 2020 FYE 2021 FY
Slide 23: Condensed Consolidated Balance Sheets
August 31, 2021 August 31,2020 (I n thousands, except share and per share amounts) ASSETS: Current assets: Cash and cash -qutvalents Trade accounts receivable,net Prepaid expenses and other assets Land development inventories Notes receivable-public tmprovernent rcimbursablcs-related pany Income tax
Slide 24: Consolidated Statement of Operations and Comprehensive Income
\'ear Ended August 31, Augu<t 31, 2021 2020 Revenues: Metered water usage from: Municipal customers Oil and gas operations Wastewater treatment fees Water and wastewater tap fees Lot sales Project management fees Special facil ity projectS and other Total revenues $ $ 524 51 3 96 5,641 18,934 846 2,
Slide 25: Leadership and Board of Directors
LEADERSHIP AND BOARD OF DIRECTORS Mark W. Harding President and CEO Kevin B. McNeill Vice President and CPO Jeffrey G. Sheets Director and Chairman of the Nominating and Governance Committee Patrick J. Beirne Chairman of the Board Peter C. Howell Director and Chairman of the Audit Committee Arthur G
Slide 26: Contact and Company Information
CONTACT AND COMPANY INFORMATION Questi-ons{n CORPORATE HEADQUARTERS 34501 E. Quincy Ave, BLDG 34, Watkins, CO 80137 CONTACT INFO Aw Cydt-Coo'Dor11ticft, lD, NASil.lr.Q 1S.SI .O.S7l•l.12\) Vol Sl.l66K info@purecyclewater.com 303-292-3456 www.purecyclewater.com 16 50 Follow us on twitter @PureCycleCor