Pure Cycle Corporation

Good morning, everybody, and welcome to PeerCycle Corporation's third quarter earnings call. We'll start with a presentation from our CEO, Mark Harding, before moving into the Q&A session. We'll ask that everybody mute. Sorry about that. We went ahead and muted everybody, and when we get to the Q&A session, we'll make sure the mics are open. But we ask that you stay muted until you're called on. And with that, I'll turn the presentation over to our CEO, Mark Harley. Thank you. Good morning.

Welcome to our third quarter earnings call. With me today, you just heard Mark Fizali as our CFO, as well as our controller, Serena Finnegan. So if you have any hard questions, they'll help chime in on that. We do have a deck for this, so for those of you that are on this live, you can see the deck by going to our website. On the landing page, there will be a tab that you can click onto. I'll advance through the slides as I go through the presentation, and then for those that are listening to this on the replay, I'll try and note those slide transitions so you can kind of match the audio together with the slide deck. So with that, we'll get started. Our first slide is always to get the lawyers out of the room. So you all are familiar with forward-looking statements. Statements that are contained or incorporated by reference in this are forward-looking statements. That has that meaning by the Security and Exchange Commission. I want to jump on really kind of highlight our leadership team. So this is your leadership team. We have a tremendous amount of experience in all of the business segments that we have, a very consistent and constant team that I have the pleasure of working with day in and day out. But they are really responsible for delivering the results for the company, and so it's a delight to continue to work with our team, as well as our board. As many of you know that have been following the company, we really do punch above our weights on some outstanding leadership and expertise in our board from all disciplines of what it is that the company does. So I do want to give them credit for their continued stewardship of the company, the company's capital, and kind of delivering the results that we experience. So let me jump right into the financials. Third quarter, taking a look at it both in terms of the quarter and then year to date. Quarterly revenues, $5 million, you know, continued to deliver terrific results on gross profits, about a 63% margin there. So $3.2 million in gross profits. I do want to note a couple of the highlights. One of the key things that we're seeing this year is One of the diversifications that the company has is that we do have some mineral estates. We've seen some tremendous results from our mineral estate this year. And that was a result of drilling additional wells in 2024 that came online. So quarterly results, a little over a million dollars there. If you take a look at it from year to date, close to $6 million on that. So that's a nice bump to the financial performance on that. A little bit over $2 million in net income on the quarterly basis, about $0.09 per share. And then you take a look at that on a year-over-year basis or year-to-date basis, that's about $7 million. So $0.29 earnings per share on the fiscal year 2025. Taking a look at the trending revenues, they're slightly down from previous quarters. And the principal reason for that is just the weighted deliveries that we have for lots in filing six. You know, our largest home builder, D.R. a weighted inventory of lots that they have. They are on a finished lot structure for us. And so taking a look at how those deliver, we're on schedule and on pace on delivering those lots. We'll deliver those lots by our fiscal year end, and that'll catch up. But there's a little bit of a weighted delivery on that. This particular filing, they have about 70 lots, where traditionally they have about 45. So it's almost twice the number of lots that they have on that structure. So that skews the results a little bit. It's not necessarily indicative of any of the year-to-date performances. It's just that particular filing had a weighted average on that. When you take a look at it at a quarter-over-quarter basis, that's going to be weighing in a little bit on that side. So this will give you that look, about $5 million in this quarter.

And then when you take a look at gross profit, about 3.2. Those are kind of carrying forward. Take a look at it from a net income and an earnings per share quarter of a quarter.