Pure Cycle (PCYO) investor relations material

Executive summary

• Achieved a record-setting Q1 with net income of $4.6 million, up 16% year-over-year, marking 26 consecutive profitable quarters and six straight years of net income, driven by strong land development and recurring revenue streams.

• Revenue rose 59% year-over-year to $9.1 million, primarily from accelerated lot sales and tap fee revenue at Sky Ranch, with early-year results ahead of forecasts.

• Earnings per diluted share increased 19% to $0.19, with gross profit of $6.3 million and operating income up 155% to $4.4 million.

• Expanded builder partnerships to seven national builders and continued growth in single-family rentals, with 19 homes completed and plans to reach 100 homes in Phase 2.

• Maintained a strong balance sheet and liquidity, supporting ongoing development and share repurchases.

Financial highlights

• Q1 2026 revenue increased to $9.1 million, up from $5.4 million in Q1 2025, with gross profit of $6.3 million and net income of $4.6 million.

• EPS for Q1 2026 was $0.19, compared to $0.16 in Q1 2025, and cash and cash equivalents totaled $17.1 million at quarter-end.

• Working capital stood at $14.8 million, and total assets reached $168.1 million.

• Pre-tax income for the quarter was $6.0 million, and EBITDA was $6.7 million.

• Fiscal year 2026 guidance maintained at $26–$30 million in revenue and $0.43–$0.52 EPS.

Outlook and guidance

• On track to meet or exceed fiscal 2026 guidance, with strong lot deliveries, recurring revenue growth, and continued expansion in rentals and tap sales.

• Phase 2D of Sky Ranch expected to be substantially complete by end of fiscal 2026, with Phase 2E development and 159 lots beginning in summer 2026.

• Expects over $19 million in additional tap fee revenue from Phase 2 over the next three years.

• Commercial development and oil/gas water deliveries expected to boost future growth, with a breakout year anticipated in 2028.

• Management expects moderate to lower demand for new homes through 2026 due to affordability and macroeconomic uncertainty.