Slide 1: Earnings Presentation for the Three and Six Months Ended February 28, 2023
EARNINGS PRESENTATION FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 28, 2023 ---== --.cc:;;===:::-:-- - . ? ,. · n, ~•wr11::1• ---- ~ -=- - -- lit"' • - n .,,,...__ ~ _, "--.---r: -.. ~ - - -- ... "I,. ➔ -· ---~ __: -•• 7 - - -- ------ · ~ .. - OS ' 'l ' ~ .. •• ~ -r '' :' ,,,~-!!tlr:: - ~~ ~ ~. _r I
Slide 2: Safe Harbor Statement
Safe Harbor Statement 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 21 C o
Slide 3: We Operate Multiple Complementary Segments
WE OPERATE MULTIPLE COMPLEMENTARY SEGMENTS ... ...driving value for stakeholders with water, land, and rentals Water and Wastewater Resource Development Segment • Own nearly 30K acre-feet of water rights (surface and ground water) • Sustainable water rights we estimate can serve up to 60,000 SFEs •
Slide 4: Water and Wastewater
EARNINGS PRESENTATION FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 28, 2023 ---== --.cc:;;===:::-:-- - . ? ,. · n, ~•wr11::1• ---- ~ -=- - -- lit"' • - n .,,,...__ ~ _, "--.---r: -.. ~ - - -- ... "I,. ➔ -· ---~ __: -•• 7 - - -- ------ · ~ .. - OS ' 'l ' ~ .. •• ~ -r '' :' ,,,~-!!tlr:: - ~~ ~ ~. _r I
Slide 5: Wholesale Water & Wastewater
Wholesale Water &Wastewater Well/Diversion Build Usage • Vertica lly integrated, meaning we own, • Capacity to serve 60,000 taps • Base fee= $32.74 treat and sell water then collect, treat, • Capital Capacity = $2.0 billion • Consumption fee = Tiered and resuse wastewater • One-Time Connection Fees:
Slide 6: Water System Balance
Water System Balance With Losses and Required Discharges Ground Water Supply Treatment £. £. Evaporation~ ~ Surface Water Outdoor Irrigation Supply Discharge to Stream
Slide 7: Water Assets / Infrastructure Inventory
All major infrastructure is in service to support all of Phase 2 of the Sky Ranch development Water Assets/Infrastructure Inventory • 2 Wastewater reclamation F Q2-2023 facilities FY 2022 • 20+ miles of transmission pipeline FY 2021 • 4 Alluvial wells Water FY 2020 $59.2M • 150 Acre -feet surface st
Slide 8: Customers - 1,283 System Capacity
Customers - 1,283 System Capacity Wild Pointe New Residential New Commercial 73 Residential 70 Commercial/ Irr. Residential water and wastewater customers added with • Future Sky Ranch commercial phases to include the Copa every new phase at Sky Ranch equivalent of 1,800 taps ~ 60 • Avg. residential
Slide 9: Oil & Gas
OIL& GAS We provide raw water to oil and gas operators for drilling with 120 wells drilled to date Southern Wattenberg Niobrara • Q4 - ('I) N • Q3 0 N 1 Mulitple Formations > • Q2 LL - • Q1 N N I 0 N Pad Development: 40 Acre spacing > LL - ....N I 0 I N 16 wells/mile formation > LL - 0 N 0 N I Oil r
Slide 10: Development Encroachment to Lowry Range
DEVELOPMENT ENCROACHMENT TO LOWRY RANGE
Slide 11: Land Development
EARNINGS PRESENTATION FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 28, 2023 ---== --.cc:;;===:::-:-- - . ? ,. · n, ~•wr11::1• ---- ~ -=- - -- lit"' • - n .,,,...__ ~ _, "--.---r: -.. ~ - - -- ... "I,. ➔ -· ---~ __: -•• 7 - - -- ------ · ~ .. - OS ' 'l ' ~ .. •• ~ -r '' :' ,,,~-!!tlr:: - ~~ ~ ~. _r I
Slide 12: Land Development
LAND DEVELOPMENT • Developing the 930 acre Sky Ranch (Currently developing Phase 2A - Phase 28 begins in April 2023) • Can accommodate up to 3,200 residential lots • Can accommodate up to 2M sq. ft. of commercial development (1,800 SFE's) • 15 miles east of downtown Denver and 4 miles south of DIA
Slide 13: Sky Ranch Phases and Partnering Homebuilders
Phase 1 Phase 2 Phase 1 - 509 lots Phase 2A - 229 lots 87% complete - est. completion 2023 100% Complete - Completed 2022 Phase 2B - 211 lots Rental lots - 4 lots 0% complete - est. completion 2024 (Started April 2023) Phase 2C - 204 lots 0% complete - est. completion 2025 Sky Ranch Academy Phase 2D
Slide 14: Sky Ranch Phase 2 Financial and Quantitative Data
SKY RANCH PHASE 2 Financial and Quantitative Data TOTAL LOTS BY TYPE TOTAL LOTS BY BUILDER TOTAL LOT SALES BY BUILDER $26m $24.Sm $24m $22m $20m $18m $17.2m $ 10.7m • 45' LOTS • 45' LOTTS (ALLEY) • 50' LOTS • 35' LOTS • DUPLEXS • CHALLENGER • LENNAR • DR HORTON • KB HOMES • PCYO SFR Phase 2A (229 LO
Slide 15: Market Conditions
Market Conditions Continued demand for new home sales 2005/2006 - 1.4M 2021 /2022 - 600K Interest Rates Abrupt uptick in 2022 - 3% to 7% (70s - 9%, 80s - 13%, 90s -8%, 2000s - 6%, 201 Os - 4%) Mortgage rates stabalizing - Lot deliveries still trailing sti ll at historical averages home starts All ho
Slide 16: Sky Ranch Academy
SKY RANCH ACADEMY DCNVU INrUINATIONAL AUIPORl Colorado Air and Space Port GRf.::NYtJlt~ • Watkins ' ® @ a en @ 396 Total Applicants Pure Cycle Corporati on I Earnings 0 Presentation
Slide 17: Single-Family Rentals
EARNINGS PRESENTATION FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 28, 2023 ---== --.cc:;;===:::-:-- - . ? ,. · n, ~•wr11::1• ---- ~ -=- - -- lit"' • - n .,,,...__ ~ _, "--.---r: -.. ~ - - -- ... "I,. ➔ -· ---~ __: -•• 7 - - -- ------ · ~ .. - OS ' 'l ' ~ .. •• ~ -r '' :' ,,,~-!!tlr:: - ~~ ~ ~. _r I
Slide 18: Single-Family Rentals
Single-Family Rentals Pure Cycle contracts to build single family homes in it's Sky Ranch Master Planned Community to hold for rentals. • Retaining lots within the community it's building and adding value • Lot development costs fully recovered (horizontal costs and tap fees) • Contracting with expe
Slide 19: Four Units Completed and Rented
- ~ • ~9 Four units completed and rented II Ii II . , \ .- l ~ •.-:,:r . Flexible debt usage up to 70% of appraised value '".;r"' . ,·· -~ ,-;::,-t~ f ..... " --- J I { ' •.• ~ - · _.. , · ·.: • fl • • IJ •• Low cost capital (3.75 - 4.25%) ·...... -;~..: . ·.:. . - House appraisal value estimated at
Slide 20: Our Single Family Rentals - Operations and Cash Flows
Our Single Family Rentals -Operations and Cash Flows Actual Results 3 Projected to 14 Projected to 83 Projected to 200 Item Annualized Avg per home/yr units* homes/yr homes/yr homes/yr Rental Income $ 82 $ 98 $ 33 $ 459 $ 2,739 $ 6,560 Operating Costs 30 36 72 768 996 2,400 G&A, Interest and Depreci
Slide 21: Financial Results
EARNINGS PRESENTATION FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 28, 2023 ---== --.cc:;;===:::-:-- - . ? ,. · n, ~•wr11::1• ---- ~ -=- - -- lit"' • - n .,,,...__ ~ _, "--.---r: -.. ~ - - -- ... "I,. ➔ -· ---~ __: -•• 7 - - -- ------ · ~ .. - OS ' 'l ' ~ .. •• ~ -r '' :' ,,,~-!!tlr:: - ~~ ~ ~. _r I
Slide 22: Financial Results - YTD Summary
Financial Results YTD 02 Summary WATER & WASTEWATER LAND DEVELOPMENT SINGLE FAMILY RENTALS • $67.8 min water assets (cost) • Phase 2A 87% complete • $1.5m in completed assets with an approximate market value >$2.0m • 1,283 total taps served • Phase 2B 0% complete, received 1st milestone payment from
Slide 23: Financial Results - Revenue
Financial Results Fiscal YTD 02-2023 Revenue Segment Revenue $14M $14M $12M $12M $10M $10M ,......._ ,,......_ en Cl) "O $SM ~ $8M C ro co Cl) en :::, ::J 0 ..c -C C, $6M - .c 0 C .;,::, $6M $4.41 M $4M $5.02M $4M $10.81M $3.33M $2.04M $2M $2M 0 $2.38M $3.17M $5.19M $3.89M $2.24M 0 YTD 2019 YTD 2020
Slide 24: Financial Results - Net Income and Diluted EPS
Financial Results Fiscal VTD 02-2023 Net Income $20M Diluted EPS $0.8 $18M $0.7 $16M $0.6 $14M i $12M C $0.5 ro ~ $10M 0 $0.4 .... .s:::. .S $SM .__, $0.3 $6M $0.2 $4M $0.1 $2M $0.54M $0.35M $0.02 0 0 $0.01 2019 2023 2019 2023 tl~:..d
Slide 25: Balance Sheet
(In thousands, tZXCllpt sharlls) February 281 2023 August 311 2022 ASSETS: (unaudited) Current assets: Cash and cash equivalents s 7 ,224 s 34,894 lovestments in U.S. Treasury Bills 15,245 Trade accounts receivable, net 2,121 2,425 locome truces receivable 1,610 Prepaid expenses and other assets 603
Slide 26: Income Statement
Thri!t! llonths Ended Six lfontbs Ended (In thousands. e:.-.c~pt share mformano,i) Ftbruary 28, 2023 February 28, 2022 Ftbruan 28, 2023 Februan· 28, 2022 RC'\c:nucs: Metered watc:r ur.aic: &om: Mumc:ipal c:ustomers $ 83 s 69 s 204 $ 180 INCOME STATEMENT Coou11c1"CiaJ customers Wablewnlc:r tn:abuc:ut
Slide 27: Share Repurchase Authorization / Upcoming Dates
SHARE REPURCHASE AUTHORIZATION/ UPCOMING DATES I Stock Repurchase Program - 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. No shares repurchased
Slide 28: Leadership and Board of Directors
LEADERSHIP AND BOARD OF DIRECTORS Mark W. Harding Kevin B. McNeill President and CEO Vice President and CFO Patrick J. Beirne Peter C. Howell Jeffrey G. Sheets Director and Chair of the Chair of the Board Director Audit Committee Wanda J. Abel Daniel R. Kozlowski Fredrick A. Fendel III. Director and
Slide 29: Questions?
CONTACT AND COMPANY INFORMATION CORPORATE HEADQUARTERS 34501 E. Quincy Ave, BLDG 65, Suite A, Watkins, CO 80137 CONTACT INFO info@pu recyclewater. com 303-292-3456 www. pu recyclewater. com Questions? Follow us on ... "JI Twitter: @PureCycleCorp ml Linkedln: https://www.linkedin.com/company/pure-cyc
Slide 30: Earnings Presentation for the Three and Six Months Ended February 28, 2023
EARNINGS PRESENTATION FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 28, 2023 ---== --.cc:;;===:::-:-- - . ? ,. · n, ~•wr11::1• ---- ~ -=- - -- lit"' • - n .,,,...__ ~ _, "--.---r: -.. ~ - - -- ... "I,. ➔ -· ---~ __: -•• 7 - - -- ------ · ~ .. - OS ' 'l ' ~ .. •• ~ -r '' :' ,,,~-!!tlr:: - ~~ ~ ~. _r I