Pure Cycle Corporation (NASDAQ:PCYO) stock rose 9.95% (As on July 11, 11:56:49 AM UTC-4, Source: Google Finance) after the company in the third quarter of FY 24 has reported total revenues of $7.6 million and $6.9 million with $2.5 million and $3.6 million being generated in the water and wastewater resource development segment, $5.0 million and $3.2 million generated by the land development segment, and $0.1 million and less than $0.1 million reported in the single-family rental business. For the three months ended May 31, 2024, and 2023, the company sold 20 and 44 water or water and wastewater taps for $0.6 million and $1.3 million. The company 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, the company expects to have a total of 93 homes in Phase 2 with the ability to add more than 200 homes as Sky Ranch builds out.

Moreover, 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. Lot sales revenue increased to $4.8 million for the three months ended May 31, 2024 compared to $3.2 million in 2023.