Pure Cycle Corp (PCYO) 2023 Q4 法說會逐字稿

Greetings, and welcome to Pure Cycle Corporation's Year end 2023 Earnings Call.

您好，歡迎參加 Pure Cycle Corporation 的 2023 年終收益電話會議。

(Operator Instructions) Please note, this conference is being recorded. I will now turn the conference over to your host, Mr. Mark Harding, President and CEO of Pure Cycle. Mark, over to you.

（操作員說明）請注意，本次會議正在錄製中。現在我將會議交給東道主 Pure Cycle 總裁兼執行長 Mark Harding 先生。馬克，交給你了。

Thank you, Jenny. Good morning, and welcome. As we mentioned, this will be our fiscal year-end 2023 call. Excited to be able to highlight some of our activities, the financial results for the last fiscal year and really kind of give you guys an idea of how the company is doing with each of its business segments. For logistics, there is a slide deck for this presentation. If you go over to our website at purecyclewater.com, there'll be a tab on the landing page that says join the live presentation. You can click on that, and you'll see the slides for that.

謝謝你，珍妮。早上好，歡迎光臨。正如我們所提到的，這將是我們 2023 財年年底的電話會議。很高興能夠專注於我們的一些活動、上一財年的財務業績，並真正讓大家了解公司每個業務部門的運作情況。對於物流，此演示有一個幻燈片。如果您造訪我們的網站 purecyclewater.com，登入頁面上會出現一個選項卡，顯示「加入現場演示」。您可以單擊它，然後您將看到相應的幻燈片。

I've been asked to note for those that are going to be listening to this after the call or listening to the rebroadcast. We'll have the audio presentation put up on the website, so you can click on the audio, and then you'll have the slide deck as well, so you can click through the slides and kind of match the audio to the slides as well. If you're listening on the rebroadcast of it. So with that, I'm going to start. And the first thing we've got to do is talk about the forward-looking statements and the fact that statements are not necessarily historical facts or may be incorporated by reference in this presentation. I think most of you are familiar with the forward-looking statements, but we'll get the lawyers out of the room and kind of get on with talking a little bit about the year, do a little bit different this year. I know most of you are going to be familiar with the company. And so for those of you that are going to be new to the company, you can kind of see -- run to our website.

我被要求為那些將在通話後收聽此內容或收聽重播的人做筆記。我們將在網站上發布音頻演示文稿，這樣您就可以單擊音頻，然後您還將獲得幻燈片，以便您可以單擊幻燈片並將音頻與幻燈片進行匹配，如下所示出色地。如果你正在收聽它的重播。那我要開始了。我們要做的第一件事是討論前瞻性陳述，以及這些陳述不一定是歷史事實或可以透過引用納入本簡報的事實。我想你們大多數人都熟悉前瞻性陳述，但我們會讓律師離開房間，繼續談論今年的情況，今年做一些不同的事情。我知道你們大多數人都會熟悉這家公司。因此，對於那些剛加入公司的人來說，您可以訪問我們的網站。

There's a ton of different resources on the website that will be a little bit more in depth about the company, what each of our business segments are sort of the portfolio that we have. What we're going to do is talk a little bit about our strategies, talk a little bit about how we measure performance, a little bit about the asset trajectory and then kind of the objectives and the capital plan, the company [chart senior]. One of the things that we do describe a lot of is kind of our highly valuable assets. And as many of you have heard me talk from time to time. Our most valuable asset really is who we get to work with at our company, our people here. You've heard me talk about the growth of those assets and our leadership team continues to grow. So we continue to add human capital to the company to continue to execute all of our business segments. We have just a tremendous Board of Directors, very strong punch above our weight necessarily for a small company with the caliber of the Board of Directors that we have. And each of our business segments are really complementary where we add value in one, we add value to all. And so you'll get a little bit of flavor for how we invest in each of our business segments. And then a little bit about how the investments and the assets are performing.

網站上有大量不同的資源，這些資源將更深入地介紹公司、我們的每個業務部門以及我們擁有的產品組合。我們要做的是談談我們的策略，談談我們如何衡量業績，談談資產軌跡，然後談談目標和資本計劃，公司[高級圖表] 。我們經常描述的一件事是我們非常有價值的資產。正如你們中的許多人時不時聽到我講話一樣。我們最寶貴的資產實際上是我們公司的同事，我們的員工。您已經聽我談論過這些資產的成長以及我們的領導團隊的不斷壯大。因此，我們繼續為公司增加人力資本，以繼續執行我們所有的業務部門。我們擁有一個強大的董事會，對於像我們這樣有能力的小公司來說，其力量必然超出我們的承受能力。我們的每個業務部門確實是互補的，我們為其中一個業務部門增加價值，為所有業務部門增加價值。因此，您會對我們如何投資每個業務部門有所了解。然後介紹一下投資和資產的表現。

So with that, want to talk a little bit about our leadership team. I want to welcome Mark Bazzali to the team. This makes three marks in leadership positions in the company. And I'm not sure if there's a correlation to the name and the smart factor. I'm just saying we've got a lot of smart folks here, and a lot of them named Mark. But Mark joins us as our CFO. We continue to rely on the wisdom and experience of Scott Lehman to direct our engineering and then Dirk Lashnits who handles our land development segment. So continued strong leadership team within the company. We operate -- as (inaudible), you know, we operate in three complementary business segments. The water and wastewater Resource Development segment, where we have a strong portfolio of water rights. We develop those water rights under a cradle-to-grave approach where we own the water. We develop the infrastructure that diverts it that pulls it to the surface, treats it, delivers it to our customers. We collect that back and we process that water and reuse that water supply. We have -- in the last few years, really excel that land development and we're developing one of the more highly respected master planned communities in the Denver metropolitan area and really succeeding not only for developing the land in a smart and efficient way, but also making sure that we're developing that land in an affordable entry-level market segment, which is really benefiting us in kind of a diversity of market segments in the housing business.

因此，想談談我們的領導團隊。我歡迎馬克·巴扎利 (Mark Ba​​zzali) 加入我們的團隊。這在公司的領導職位上取得了三分。我不確定這個名字和智能因素是否有關聯。我只是說我們這裡有很多聰明人，其中很多人叫馬克。但馬克加入我們，擔任我們的財務長。我們繼續依靠 Scott Lehman 的智慧和經驗來指導我們的工程，然後依靠負責我們土地開發部門的 Dirk Lashnits。因此，公司內部繼續保持強大的領導團隊。我們經營－（聽不清楚），你知道，我們經營三個互補的業務部門。在水和廢水資源開發領域，我們擁有強大的水權組合。我們以從搖籃到墳墓的方式發展這些水權，我們擁有水。我們開發基礎設施，將其轉移到地面，對其進行處理，然後將其交付給我們的客戶。我們收集回來的水並進行處理並重複利用供水。在過去的幾年裡，我們在土地開發方面確實表現出色，我們正在開發丹佛大都會區最受尊敬的總體規劃社區之一，並且真正取得了成功，不僅以智能和高效的方式開發了土地，但也要確保我們在負擔得起的入門級細分市場中開發土地，這確實使我們在住房業務的多元化細分市場中受益。

And then more recently, really adding single-family rentals to that holding back some of those lots that we have that we're developing and delivering to our homebuilder customers and keeping those lots of ourselves to have homes for single-family rental. So each of these segments really do relate to the other one and as we invest in each of them, all of them are benefiting. So you see a strong leverage effect on how these investments add to the entire portfolio to the company. Taking a look at the next slide, strong asset portfolio. And what's important about our assets is not only how valuable they are in our business segments, but how we continue to grow each of them. And that we're still very early on in each of these segments. You hear me talk a lot about or highly appreciated assets that we've had. And some of these we've had for a very long time. Our water and wastewater assets we've had for more than 30 years. You take a look at just that segment alone, that's -- we continue to grow that segment. We've got about $64 million in total assets in that particular segment and at our current rates and charges, and we'll talk a little bit more about this later in the presentation. But it has the capacity to generate over $2 billion in revenue potential.

最近，確實增加了單戶住宅的租金，這阻礙了我們正在開發並交付給住宅建築商客戶的一些地塊，並保留了我們自己的這些地塊用於單戶出租。因此，這些細分市場中的每一個確實都與另一個細分市場相關，當我們對每個細分市場進行投資時，所有這些細分市場都將從中受益。因此，您將看到這些投資如何添加到公司的整個投資組合中具有強大的槓桿效應。看下一張投影片，強勁的資產組合。我們的資產的重要之處不僅在於它們在我們的業務部門中的價值，還在於我們如何繼續發展它們。我們在每個細分市場都還處於早期階段。你聽到我談論了很多關於我們擁有的或高度讚賞的資產。其中一些我們已經擁有很長時間了。我們的水和廢水處理資產已擁有 30 多年。你只看一下這個細分市場，那就是──我們繼續成長這個細分市場。按照我們目前的費率和收費，我們在該特定細分市場的總資產約為 6,400 萬美元，我們將在稍後的演示中詳細討論這一點。但它有能力創造超過 20 億美元的收入潛力。

Our land development segment, we bought those -- bought that land right. We bought that at the height of the -- Great Recession in 2010, very low basis in that, about $4.5 million and as we'll highlight a little bit more, that asset continues to generate very strong returns and has more than about $500 million of asset potential or revenue potential in its continued development. And then taking a look at our newest segment, where we continue to grow. We have about 4 -- about $5.4 million in 14 single-family rental homes currently to date. We have a unique ability to carry forward some of the equity value that we have in the land and the water side of that. And so what we have is a strong leverage opportunity and a tax advantage way of renting those out and having that asset, which has a fair market value of about $7.2 million continue to grow. We're looking at growing that segment up to more than $100 million with a couple of hundred units in our Sky Ranch community, and we'll talk a little bit more about that.

我們的土地開發部門，我們買了那些──買了那塊土地。我們在 2010 年經濟大衰退最嚴重的時期購買了該資產，基數非常低，約為 450 萬美元，正如我們要強調的那樣，該資產繼續產生非常強勁的回報，價值超過約 5 億美元其持續發展中的資產潛力或收入潛力。然後看看我們不斷成長的最新細分市場。迄今為止，我們在 14 棟單戶出租房屋中擁有約 4 套（約 540 萬美元）。我們擁有獨特的能力來延續我們在土地和水方面擁有的部分股權價值。因此，我們擁有強大的槓桿機會和稅收優惠方式，可以出租這些資產並讓該資產繼續增長，該資產的公平市場價值約為 720 萬美元。我們正在考慮透過 Sky Ranch 社區中的數百個單位將該部分增長到 1 億美元以上，我們將對此進行更多討論。

What I want to do is jump straight into some of the financial results for the year and some of the key performance indicators. I'll let you know a little bit about the key takeaways and kind of how we think about that. So this year, we generated about $14.5 million and about $8 million in gross profit areas. Revenues are down just a bit, and it's largely due to timing of the starting of Phase 2B. As interest rates started to get really wonky about this time last year, some of our homebuilder customers really wanted us to give them a 90-day breather to see how this was going to stabilize out. And so that, on a percent complete basis on how we develop our lot revenues really was the reason for a lot of the shift in some of these revenues. Also, they had some timing gaps in some of our fracking last summer, and it was really due to advancing technologies on now drilling and fracking even longer laterals. They started out of a mile. They were going to 2 miles and in some wells there now at 3-mile laterals. And so there's a little bit of learning curve on fracking those 3-mile horizontal wells on that. They haven't really lost any of these revenues. We're sort of just pushing and adjusting the timing variances of these into Q1 and into fiscal '24.

我想做的是直接跳到今年的一些財務表現和一些關鍵績效指標。我會讓您了解一些關鍵要點以及我們對此的看法。今年，我們的毛利約為 1,450 萬美元，毛利約 800 萬美元。收入略有下降，這主要是由於 2B 階段的啟動時間。去年這個時候，利率開始變得非常不穩定，我們的一些住宅建築商客戶確實希望我們給他們 90 天的喘息時間，看看利率將如何穩定下來。因此，從我們如何開發批次收入的完整百分比來看，這確實是其中一些收入發生很大變化的原因。此外，去年夏天他們在我們的一些水力壓裂中存在一些時間間隙，這實際上是由於現在鑽探和水力壓裂甚至更長的支管技術的進步。他們從一英里處出發。他們本來要去 2 英里，在一些油井中，現在是 3 英里的支線。因此，對 3 英里長的水平井進行水力壓裂需要一些學習曲線。他們並沒有真正損失任何這些收入。我們只是將這些時間差異推入並調整到第一季和 24 財年。

Net income and earnings per share continue to generate strong net income and earnings under great margins and return on our assets, and I'll highlight a little bit of that in some of the details here. Taking a look at -- we often talk about our highly appreciated assets and the healthy margins. And one of the things I thought I'd do is really try and highlight them for you. Taking a look at each of the three segments, our Water segment, our land development segment and our SFR segments. Our gross margins in here are tremendous opportunities. A lot of it is just because of the length of time and our disciplined approach to acquiring these assets and how we develop these assets in each of the segments, our water assets, how we look at those. We look at those on gross margins, excluding depreciation. So it's kind of a gross margin EBITDA approach to it. And we have both tapping margins in there as well as the usage revenue margins. In our land development segment, our gross margins there are extraordinary. Those do include not only the opportunities that we generate when we sell lots to the builders, but also through the public improvement reimbursables that we get. We've talked a lot about that through as we build the roads, curbs and gutters. We turn those over to the governmental jurisdictions and then we get paid back for those investments through various funding mechanisms and municipal bonds and those types of activities.

淨利潤和每股收益繼續在高利潤率和資產回報率下產生強勁的淨利潤和收益，我將在此處的一些細節中強調這一點。看看——我們經常談論我們高度讚賞的資產和健康的利潤率。我想做的一件事就是真正嘗試為您突出顯示它們。看看我們的水務部門、土地開發部門和 SFR 部門這三個部門中的每一個部門。我們在這裡的毛利率是巨大的機會。這在很大程度上只是因為時間的長短和我們收購這些資產的嚴格方法，以及我們如何在每個細分市場開發這些資產，我們的水資產，以及我們如何看待這些資產。我們看的是毛利率，不包括折舊。所以這是一種毛利率 EBITDA 方法。我們既有利用利潤，也有使用收入利潤。在我們的土地開發領域，我們的毛利率非常高。這些確實不僅包括我們向建築商出售地塊時產生的機會，還包括我們獲得的公共改善補償。當我們建造道路、路緣石和排水溝時，我們已經討論了很多這個問題。我們將這些資金移交給政府管轄區，然後透過各種融資機制和市政債券以及此類活動獲得這些投資的回報。

And then recently, our SFRs, which continue to generate high margins for us, largely because of the equity roll that we have in carrying forward the land and the water opportunity there. So it gives you kind of a framework for not only how we're generating the revenues on that, but what the margins are on each of those business segments. Let's talk a little bit about where our revenues come from. In our Water and Wastewater segment, as you can see through this illustration, really 3/4 of our revenues come from sales to oil and gas and then really taking a look at the water or the residential wastewater treatment and commercial water that are allocated from [taps] largely due to irrigation. [Tap fees] are largely generated through our land development segment at Sky Ranch, although we do have continued growth in some of our other businesses acquisitions in the Wild Point sector where that's an existing community, and we're building out -- I think most of the residential is completed there, but we continue to build out some of the commercial in there and some of those commercial water customers.

最近，我們的 SFR 繼續為我們帶來高利潤，這主要是因為我們在推進那裡的土地和水資源機會方面擁有股權滾動。因此，它為您提供了一個框架，不僅可以說明我們如何產生收入，還可以說明每個業務部門的利潤率。讓我們談談我們的收入來自哪裡。在我們的水和廢水部門，正如您透過此圖看到的那樣，我們實際上 3/4 的收入來自石油和天然氣銷售，然後真正看看水或住宅廢水處理和商業用水，這些水是從[水龍頭]主要是由於灌溉。 [自來水費]主要是透過我們在Sky Ranch 的土地開發部門產生的，儘管我們在Wild Point 領域的其他一些業務收購中確實取得了持續增長，那裡是一個現有社區，而且我們正在擴建——我認為大部分住宅已在那裡完工，但我們繼續在那裡建造一些商業設施和一些商業用水客戶。

And then what this continues to show is a tremendous continued growth in our customers year-over-year. So we've got a 20% customer growth, and that's largely driven by the Sky Ranch project, but great organic growth in our customers. Land development, talk a little bit about -- we delayed the start of that Phase 2B, which we talked about. There was about a 90-day delay at the request of our homebuilders. And really, it was just because they wanted to kind of see how the market segmentation was going to shake out with the rising interest rates. And then all this really did was pushed a little bit of our percent completion in Phase IIb into fiscal '24. Market, I'd say, is fairly stabilized. When you take a look at interest rates, they are more attuned to kind of a historical average at that 7% rather than what was an anomaly at the low rate. But what we are seeing is the strength of our market segmentation, that entry-level market segmentation is really enhancing the Sky Ranch project. It's really providing our homebuilder partners the opportunity to continue to build and be aggressive in the marketplace. And so one of the things that we've seen is a demand for not only what we're doing in 2B, but to start 2C and overlap the next 211 lots with the 200 that we delivered or that -- with the 211 in Phase I with about the 215 lots that we're doing in Phase 2B. So you'll see a little bit of that overlap in coming quarters in fiscal '24.

這繼續表明我們的客戶數量逐年大幅持續成長。因此，我們的客戶成長了 20%，這主要是由 Sky Ranch 專案推動的，但我們的客戶也實現了巨大的有機成長。土地開發，稍微討論一下——我們推遲了我們討論過的 2B 階段的開始。應我們的房屋建築商的要求，延遲了大約 90 天。事實上，這只是因為他們想看看市場區隔將如何隨著利率上升而改變。然後，所有這些真正起到的作用是將我們在 IIb 階段的完成百分比推到了 24 財年。我想說，市場相當穩定。當你觀察利率時，你會發現它們更符合 7% 的歷史平均水平，而不是低利率的異常情況。但我們看到的是我們市場區隔的實力，入門級市場區隔確實增強了 Sky Ranch 專案。它確實為我們的住宅建築商合作夥伴提供了繼續建造並積極進入市場的機會。因此，我們看到的一件事是，不僅需要我們在 2B 中所做的事情，而且需要開始 2C 並將接下來的 211 批與我們交付的 200 批重疊，或者與階段中的 211 批重疊我知道我們在2B 階段正在進行的大約215 塊地塊。因此，您將在 24 財年的未來幾季看到一些重疊。

Single-family rentals. One of the things that we're able to do with this delay in the start of the 2B project was expand our portfolio of single-family rentals in Phase 2. And we went from what we originally had reserved as 40 lots to 65 lots and really was an opportunity for us to become the first customers in Phase 2B for our homebuilders. And that's great for us because we've got an efficient way of delivering those homes to the market and then also our homebuilder customers are really adding to their portfolio and how they're building these units and getting started with the rental homes that we actually hold in our portfolio. So we're very excited about this segment, how it continues to grow and the opportunities for us in renting these out and seeing continued strong demand, as I spoke from time to time, the thing that we are able to do is really rent these out as if they were a fair market value home at that $500,000 level when, in fact, we've got incremental investment that we can finance with very affordable capital. It's mortgage-based capital and be able to leverage the continued expansion, not only to the balance sheet, but the income statement here. So we really like this segment, and we'll continue to grow it.

單戶出租。在 2B 專案啟動延遲的情況下，我們能夠做的一件事是擴大我們在第二階段的單戶租賃組合。我們從最初保留的 40 個地塊增加到 65 個地塊，對於我們來說，這確實是一個成為住宅建築商2B 階段首批客戶的機會。這對我們來說非常好，因為我們有一種有效的方式將這些房屋交付市場，然後我們的房屋建築商客戶也真正增加了他們的投資組合，以及他們如何建造這些單元並開始使用我們實際的出租房屋持有我們的投資組合。因此，我們對這個細分市場感到非常興奮，它如何繼續成長，以及我們出租這些設備並看到持續強勁需求的機會，正如我時不時所說的那樣，我們能夠做的就是真正出租這些設備就好像它們是500,000 美元水準的公平市場價值房屋，而事實上，我們已經有了增量投資，我們可以用非常實惠的資本進行融資。它是基於抵押貸款的資本，能夠利用持續擴張的槓桿，不僅影響資產負債表，也影響損益表。所以我們真的很喜歡這個細分市場，並且我們將繼續發展它。

We talk a lot about where our revenues come from and that we earn great margins, but that isn't the whole story. It might be helpful for us to illustrate where we are in the cycle of development of these assets, i.e., how much pedal we have left in each of these business segments with what's currently baked into the company, with what we own, with what we control. And so highlighting some of that's going to be really giving you a flavor for how we look at it and the enthusiasm and excitement that we hold not only for each of the business segments, but for how we grow this company. If you take a look at our water and our wastewater segments, you've heard me talk about this in many, many times where our water portfolio can provide service up to 60,000 connections. We're currently a little over 1,300 connections out of 60,000 connections, so it gives you kind of an understanding of where we're extremely early on in the development of that utility segment. And our rates and charges, the tap fees, the cost of developing new water supplies and bringing them from farther and farther distances really are the reflection of the cost of those tap fees continue to rise. We continue to mark and set our rates at a competitive rate to the market, but they continue to grow. And so we're very excited about that continued growth and the continued value of that asset.

我們經常談論我們的收入來自哪裡以及我們賺取的豐厚利潤，但這並不是故事的全部。這對我們來說可能會有所幫助，說明我們在這些資產的發展週期中處於什麼位置，即，我們在每個業務部門中還剩下多少踏板，目前公司已經擁有什麼，我們擁有什麼，我們有什麼控制。因此，強調其中的一些內容將真正讓您了解我們如何看待它，以及我們不僅對每個業務部門，而且對我們如何發展這家公司的熱情和興奮。如果您看看我們的水務和廢水處理部門，您會多次聽到我談論這一點，我們的水務產品組合可以提供多達 60,000 個連接的服務。目前，我們在 60,000 個連接中擁有略多於 1,300 個連接，因此您可以了解我們在該公用事業領域的開發中處於非常早期的階段。我們的費率和收費、自來水費、開發新供水以及從越來越遠的距離輸送水的成本確實反映了這些自來水費成本持續上漲。我們繼續以具有市場競爭力的價格標記和設定我們的費率，但它們仍在繼續增長。因此，我們對該資產的持續成長和持續價值感到非常興奮。

In the land development asset side and Sky Ranch, as we highlighted in some of the previous slides. We're at about 700 out of 5,000 units. So we're still very early on in that. We're about 14%, 14.5% of the total number of lots developing in that, and we continue to grow. If you take a look at our balance sheet, we have a very, very strong balance sheet with a strong cash position and an even stronger liquidity position when you add in the receivable that we have for the municipalities that we build that infrastructure for. And then in our single-family rental segment, as we talked, we've got 14 completed units and really -- we're looking for 200, maybe even more, 200 to 300 units in that segment. So we'll continue to grow that segment, which really, again, illustrates how we're really early on in each of these segments. Water and wastewater customers and capacities, continued customer growth in utilities. Really what this is going to illustrate, we have 1,326 to be exact. And it really shows you where those are coming from. We got Wild Point Sky Ranch and our Lowry branch service area. And really one of the more hidden assets of the company is our service our exclusive service area to over 24,000 acres of property that's in the right location in the Denver metropolitan area. As you take a look at some of the graphics on our website, it's that large pink area that really represents continued growth and really this kind of illustrates both the existing and new residential as well as existing and new commercial growth in these segments.

在土地開發資產方面和天空牧場，正如我們在之前的一些幻燈片中所強調的那樣。 5,000 個單位中，我們大約有 700 個單位。所以我們還處於早期階段。我們約佔其中開發地塊總數的 14%、14.5%，而且我們仍在持續成長。如果你看一下我們的資產負債表，你會發現我們的資產負債表非常非常強勁，現金狀況強勁，加上我們為基礎設施建設的市政當局應收的應收帳款，流動性狀況甚至更強。然後，在我們的單戶租賃細分市場中，正如我們所說，我們已經擁有14 個已完工的單元，實際上，我們正​​在該細分市場中尋找200 個，甚至更多，200 至300 個單元。因此，我們將繼續發展該細分市場，這再次說明我們在每個細分市場中都處於早期階段。水和廢水處理客戶和容量，公用事業客戶持續成長。這實際上要說明的是，準確地說，我們有 1,326 個。它確實向您展示了這些來自哪裡。我們有Wild Point Sky Ranch 和我們的Lowry 分公司服務區。事實上，公司更隱密的資產之一是我們的服務，我們的專屬服務區位於丹佛大都會區的正確位置，佔地超過 24,000 英畝。當您查看我們網站上的一些圖形時，您會發現那個大的粉紅色區域真正代表了持續增長，並且實際上說明了這些細分市場中現有和新的住宅以及現有和新的商業增長。

Our largest customer in the Water segment comes from oil and gas and the outlook in oil and gas continues to look positive. Looking at it, the field ownership has consolidated. It's changed hands several times over the last few years. But now is consolidated into kind of a couple of large local operators. The field is mostly derisked where you're seeing large pad site development, where they're now on each individual pad site. They've got all the takeaway infrastructure installed, the gas takeaway system, so they don't have to flare any of that gas, they take it away into the large distribution systems and really developing it based on the backbone infrastructure they've got. So it's in that field development stage in the oil industry. And we have something along the lines of 1.5 rigs working this field on a continuous basis. A lot of that is going to be drilled in and around our service area in and around those [repo] County areas. So we're very optimistic about how this continues to add revenues to the company and really for the foreseeable future. So look for continued growth and continued high performance in the oil and gas sector.

我們在水務領域的最大客戶來自石油和天然氣，石油和天然氣的前景仍然樂觀。從這個角度來看，田地所有權已經鞏固。在過去的幾年裡，它多次易手。但現在已合併為幾家大型本地業者。在您看到大型焊盤站點開發的地方，該領域基本上沒有風險，它們現在位於每個單獨的焊盤站點上。他們已經安裝了所有外帶基礎設施，即天然氣外賣系統，因此他們不必燃燒任何天然氣，他們將其帶入大型分配系統，並真正基於他們擁有的骨幹基礎設施進行開發。所以石油工業正處於現場開發階段。我們擁有類似於 1.5 台鑽孔機的設備，可以在該領域持續工作。其中許多將在我們的服務區及其周圍的[repo]縣區域內和周圍進行鑽探。因此，我們對這如何在可預見的未來繼續增加公司收入感到非常樂觀。因此，期待石油和天然氣行業的持續成長和持續的高性能表現。

Let me talk a little bit about some of our delivery capacities. We continue to -- when we take a look at the capital allocation, we continue to invest in wells and pipelines and storage, which add to the total availability of us to supply water. And so when you take a look at that, this is really an illustration of our supply and diversified sources of supply, where we generate infrastructure in our surface water system, which is in the Box elder Creek system, our groundwater system out at the Lowry Ranch. Some of our groundwater assets out at Sky Ranch, and our existing customers on Lowry at the DHS facility. And then also our wise infrastructure and water supply, which you hear me talk a little bit about, and you'll hear discussions in the 10-K about which is our regional water supply. And when you take a look at the total capacity and what we're -- how we're using that water, we're really only using a collective 15% of our capacity. So we still have lots of opportunity for adding more supply, and that's largely going to come from oil and gas as that continues to grow. But as we continue to add more connections on Sky Ranch and more residential customers, really, you'll see that capacity ratio between our residential and our commercial customers kind of readjust. So it gives you a framework where -- we still have lots of ability to generate additional revenues as we continue to see that demand for water grow in our service area and amongst our areas that we serve in -- on an incorporated [repo county] .

讓我談談我們的一些交付能力。當我們考慮資本配置時，我們繼續投資水井、管道和儲存設施，這增加了我們供水的總可用性。因此，當你看一下時，這實際上是我們的供應和多元化供應來源的例證，我們在地表水系統中建立基礎設施，該系統位於 Box Elder Creek 系統中，我們的地下水系統位於 Lowry 中牧場。我們的一些地下水資產位於 Sky Ranch，我們的現有客戶位於 DHS 設施的 Lowry。然後還有我們明智的基礎設施和供水，您會聽到我稍微談論一下，您會在 10-K 中聽到關於我們的區域供水的討論。當你看看總容量以及我們的情況——我們如何使用這些水時，我們實際上只使用了總容量的 15%。因此，我們仍然有很多機會增加供應，而隨著石油和天然氣的持續增長，這主要來自石油和天然氣。但隨著我們繼續在 Sky Ranch 上增加更多的連接和更多的住宅客戶，實際上，您會看到我們的住宅和商業客戶之間的容量比率進行了重新調整。因此，它為您提供了一個框架，在這個框架中，我們仍然有很大的能力創造額外收入，因為我們繼續看到我們的服務區域和我們服務的區域對水的需求不斷增長，在一個合併的[回購縣] 。

And then there's also kind of how we generate tap fee revenue from that. So we have the ability at current rates actually I think that $88 million really illustrates what we were looking to develop at the tap fee revenue of the same source of supply that we've got developed. And with the fee increases that we had, I think that exceeds more than $90 million now. So great capacity in our developed water system is just why we continue to pay attention and make good investments there because there's great capacity for us to grow. This illustrates kind of where we're at in our water portfolio. And so as you've heard me talk about, we've got about 30,000 acre feet of water. And that can serve about 60,000 connections. And when you really look at what we're using on that, and we're developing that largely through Sky Ranch, the existing number of connections at Sky Ranch, the total allocated supply is about 1,100 units, which is roughly only 2% of that supply. When you take a look at what we've got developed capacities for we can supply another 2,500 taps of that water supply from what we had on the previous slide. So that's another $90 million, $95 million worth of tap fee revenue. And so we're really still just starting out on the water allocation in our portfolio.

然後還有我們如何從中產生點擊費收入。因此，我們實際上有能力以目前的價格計算，我認為 8800 萬美元確實說明了我們希望透過我們已經開發的相同供應來源的自來水費收入來開發什麼。隨著費用的增加，我認為現在已經超過 9000 萬美元了。我們發達的供水系統擁有如此巨大的容量，這正是我們繼續關注並在那裡進行良好投資的原因，因為我們有巨大的成長能力。這說明了我們在水產品組合中的位置。正如您所聽到的，我們擁有大約 30,000 英畝英尺的水域。可以為大約 60,000 個連線提供服務。當你真正了解我們在這方面使用的內容時，我們主要透過 Sky Ranch 進行開發，Sky Ranch 現有的連接數量，分配的總供應量約為 1,100 個單位，大約僅佔 2%那個供應。當您查看我們已開發的能力時，我們可以在上一張幻燈片中提供另外 2,500 個水龍頭的供水。這就是另外 9,000 萬美元、9,500 萬美元的點擊費收入。因此，我們的投資組合中的水分配確實才剛開始。

We have one of the largest unallocated portfolios in the metropolitan area. And really because of the growth of the Denver area out to our service area, this continues to be one where we have growth opportunities, not only in the water -- the tap fee connection charges but also in the usage charges. And then a little bit about the land side. So when you take a look at the land capacity, we've been developing that over the most recent 4 years, and taking a look at delivering lots to our homebuilder customers. Currently, we've got about a little over 720 lots that have been either delivered homes on or homes under construction on. And so that's about 14% of the total capacity at Sky Ranch. When you take a look at adding everything into Phase 2, which is going to be how we deliver Phase 2 AB; A is 100% complete. You saw that illustration earlier; B is about 30%. C is just getting started at around 9% and then be. So you look at that with all Phase 2 that would roughly add about 25% -- 27%. So about 1/4 of the total capacity at Sky Ranch. And when you translate what we're making there to the balance of the residential and the commercial portfolios, that's where you get that roughly looking at about $580 million at current rates today.

我們擁有大都會區最大的未分配投資組合之一。事實上，由於丹佛地區向我們的服務區域的成長，這仍然是我們有成長機會的地方，不僅在水方面——自來水連接費，而且在使用費方面。然後是關於陸地方面的一些內容。因此，當您查看土地容量時，我們在最近 4 年中一直在開發土地容量，並專注於向我們的住宅建築商客戶交付土地。目前，我們擁有大約 720 多塊地塊，這些地塊要么已交付，要么正在建設中。這大約佔 Sky Ranch 總容量的 14%。當您考慮將所有內容添加到第 2 階段時，這將是我們交付第 2 階段 AB 的方式； A 已 100% 完成。你之前看過那個插圖； B約為30%。 C 剛開始，大約是 9%，然後是。所以你看看第二階段的情況，大約會增加 25% - 27%。約佔 Sky Ranch 總容量的 1/4。當你將我們在那裡的收入轉化為住宅和商業投資組合的平衡時，你會發現，以目前的匯率計算，我們的收入大約為 5.8 億美元。

So a lot of pedal left on Sky Ranch, and we continue to be aggressive on continuing to deliver those on a just-in-time basis. So our homebuilder partners really continue to enhance their margins on that without taking these large inventories. So it gives you a bit of feel for how our land side is. And then where we look to be and where we're going on our single-family rentals. If you take a look at that and we'll peg a market at 200 units. And right now, we've got just 14 units. So we're about 7 into those. And that 200 units is still less than 10% of the overall capacity of the residential units at Sky Ranch. And so we think that's a very conservative number to add to the portfolio. There's room for us to be expanding beyond the 200 units. But this gives you kind of an illustration of where that looks to be with Phases 1 and 2A and then really all of 2 BC and D with that other 55 units. So that would again carry us up to about 27% of the overall portfolio. And then still have plenty of pedal left on that to generate annual revenues in excess of $6 million, somewhere close to $7 million. And then it's going to be about a $100 million portfolio when you take a look at a couple of hundred units on an average sale price at that $0.5 million, and it continues to grow and appreciate it 4.5%, 5% a year in these housing markets. So a very good opportunity for us to continue to grow within that segment.

因此，Sky Ranch 還剩下很多踏板，我們將繼續積極地繼續準時交付這些踏板。因此，我們的房屋建築商合作夥伴確實在繼續提高利潤，而無需佔用這些大量庫存。因此，它可以讓您對我們的陸地方面有一些了解。然後我們的單戶出租的目標和方向。如果你看一下，我們會將市場定為 200 單位。現在，我們只有 14 台。所以我們大約有 7 個。而這200個單位仍不到Sky Ranch住宅單位總容量的10%。因此，我們認為這是一個非常保守的數字，值得添加到投資組合中。我們還有擴大 200 台以上的空間。但這為您提供了一個範例，說明第 1 階段和第 2A 階段以及所有 2 BC 和 D 階段以及其他 55 個單元的情況。因此，這將再次使我們佔整個投資組合的 27% 左右。而且還有足夠的動力來實現年收入超過 600 萬美元，接近 700 萬美元。然後，當你看到平均售價為 50 萬美元的幾百個單位時，這將是一個大約 1 億美元的投資組合，並且這些住房的價格會繼續增長並每年升值 4.5%、5%市場。因此，這對我們來說是一個很好的機會，可以在這個領域繼續發展。

This is some of the highlights of just the single-family rental. You've seen me illustrate this before, but it shows our existing units, the average home per year, the projection into Phase 2 and then on through the balance of the project. So I'll give you a bit more metrics on that. So some of the key takeaways here. We're looking at some very attractive gross margins, not only gross margins, but return on assets and making sure that -- we continue to invest in those assets. That's part of our capital allocation plan, continued asset growth and really gives you kind of the strength of our ability to take advantage of the investment opportunities here. and really a clear path to continue to maximize returns with this large asset portfolio and our historically low cost basis each segment allows us to generate above market returns and substantial organic growth within those things that we can control.

這是單戶出租的一些亮點。您之前已經看過我對此進行了說明，但它顯示了我們現有的單元、每年的平均住宅、第二階段的預測以及項目的平衡。所以我會給你更多關於這方面的指標。這裡有一些關鍵要點。我們正在考慮一些非常有吸引力的毛利率，不僅是毛利率，還有資產回報率，並確保我們繼續投資這些資產。這是我們資本配置計劃的一部分，持續的資產增長，確實為您提供了我們利用這裡投資機會的能力的力量。透過這龐大的資產組合和我們歷史上較低的成本基礎，我們確實有一條明確的道路繼續實現回報最大化，每個細分市場都使我們能夠在我們可以控制的範圍內產生高於市場的回報和實質的有機增長。

Next slide. What's important is not only for us to understand how you all measure our success, but also probably a little bit helpful for you to understand how we measure our success. And these objectives that we go through, as you've seen in this presentation, are very discrete measurable objectives, they have synergistic effects with these complementary business segments. We look to allocate capital through expansion of these assets. and continue to realize these great margin returns and also look for acquisition opportunities, which will complement our existing segments. You heard me talk about the fact that we've got our nets out -- and these asset values have been very, very high historically. And then with kind of a softening of the housing market, mostly in market segments other than the entry level. I think the entry level is still highly sought after just because of a lack of inventory. And we've talked from time to time about just the anemic level of affordability in the Denver market. And I know that other major metropolitan markets struggle from that affordability factor as well. But it continues to give us opportunities to be in front of land owners that may have an interest in selling, continues to be in the front of water owners as we can continue to expand our water portfolio and then invest in our own assets so that we can continue to generate margins in each of our segments.

下一張投影片。重要的是不僅讓我們了解你們如何衡量我們的成功，而且可能對你們了解我們如何衡量我們的成功有一點幫助。正如您在本演示中所看到的，我們經歷的這些目標是非常離散的可衡量目標，它們與這些互補的業務部門具有協同效應。我們希望透過擴大這些資產來分配資本。並繼續實現這些巨大的利潤回報，並尋找收購機會，這將補充我們現有的細分市場。你聽到我談論了這樣一個事實：我們已經把我們的網拿出來了——這些資產的價值在歷史上一直非常非常高。然後，房地產市場出現某種程度的疲軟，主要是在入門級以外的細分市場。我認為，由於庫存不足，入門級產品仍然受到高度追捧。我們不時談論丹佛市場的承受能力低。我知道其他主要大都市市場也因負擔能力因素而苦苦掙扎。但它繼續為我們提供了機會，讓我們能夠站在可能有興趣出售的土地所有者面前，繼續站在水所有者面前，因為我們可以繼續擴大我們的水投資組合，然後投資於我們自己的資產，以便我們可以繼續在我們的每個細分市場中產生利潤。

If you want to highlight also that we are investing in ourselves. As you all note that we did authorize a share buyback program and typical to the company's profile. We're doing that in a measured and consistent allocation, continuing to invest in buying back shares quarter-over-quarter. So you'll continue to see us do that. We're not in it to support a particular share price, but by the same token, to illustrate to you, regardless of the share price that we continue to think that we're extremely undervalued for what the company is doing, what our company opportunities are and if the market doesn't continue to understand that, then we will continue to make that investment in ourselves. Finally, kind of a listing of our Board and our management. We continue to benefit from the terrific expertise and guidance and experience of a very diversified, very significant Board of Directors. And so with that, I'm going to turn it back to Jenny. We can see if we can open it up to some Q&A and really highlight any specifics that you all want to focus on.

如果您還想強調我們正在投資自己。正如你們都注意到的，我們確實授權了股票回購計劃，這也是該公司的典型特徵。我們正在以謹慎且一致的配置來做到這一點，並繼續按季度投資回購股票。因此，您將繼續看到我們這樣做。我們不是為了支持特定的股價，而是出於同樣的原因，向您說明，無論股價如何，我們仍然認為我們公司的價值被嚴重低估了。機會就在，如果市場不能繼續理解這一點，那麼我們將繼續對自己進行投資。最後，我們列出了我們的董事會和管理層。我們繼續受益於非常多元化、非常重要的董事會的卓越專業知識、指導和經驗。因此，我要把它轉回給珍妮。我們可以看看是否可以進行一些問答，並真正突出顯示你們都想要關注的任何細節。

Thank you very much. At this time, we will be conducting a question-and-answer session.

非常感謝。此時，我們將進行問答環節。

(Operator Instructions) Your first question is coming from John Rosenberg of Lackland Water Partners.

（操作員說明）您的第一個問題來自 Lackland Water Partners 的 John Rosenberg。

One comment and one question. First, I'll get to the question. And by the way, nice to see the progress that you guys are making. What you didn't update and I'm very curious about is how is the school going -- the charter...

一條評論和一個問題。首先，我來回答這個問題。順便說一句，很高興看到你們所取得的進展。你沒有更新，我很好奇學校進展如何——章程…

Yes, it's one of the true successes. One of the things that I think it was one of my very first meetings that we did when I -- when we sort of made the decision that we were going to do the land development ourselves was really to center this community on two key principles. One -- well, three key principles.

是的，這是真正的成功之一。我認為這是我第一次會議時所做的一件事，當我們決定自己進行土地開發時，我們所做的一件事實際上是讓這個社區以兩個關鍵原則為中心。一——嗯，三個關鍵原則。

One would be location. Being right off the interstate. We have just great transportation location. I mean, we are literally -- our residents are literally on the interstate within a minute and can go wherever they want to go. The second one was affordability, making sure that we -- affordability. I use that term loosely in the Denver market because nothing is affordable in the Denver market. But when you look at entry level, we wanted to make sure that our homebuilder customers would be competitive at that entry-level product. But the third one was education. And so -- we had our -- when I sat down with our land planners, what we wanted to do was really center the community around -- and do I have a -- I might I guess I don't I was going to -- it is on our website. You'll see a lot of the pictures of the school site. But in terms of the land plan, the school was at the center point of the community, such that every child would have a local community. A local school within the community that they could walk to.

其中之一是位置。就在州際公路旁。我們的交通位置優越。我的意思是，我們的居民實際上在一分鐘之內就可以到達州際公路，可以​​去任何他們想去的地方。第二個是負擔能力，確保我們－負擔能力。我在丹佛市場上寬鬆地使用這個術語，因為丹佛市場上沒有東西是負擔得起的。但是，當您考慮入門級產品時，我們希望確保我們的住宅建築商客戶在入門級產品上具有競爭力。但第三個是教育。因此，當我與土地規劃者坐下來時，我們想做的就是真正以社區為中心，而我是否有一個——我可能我想我沒有，我打算——它在我們的網站上。您會看到很多學校網站的圖片。但就土地規劃而言，學校位於社區的中心點，讓每個孩子都有當地社區。他們可以步行前往社區內的一所當地學校。

And so we went out and [kissed] a lot of [frogs] on the charter school opportunity ended up partnering with what was the true print. The National Heritage Academy is a group of charter schools that are headquartered out of Michigan, and they have over 100 schools in 9 states, 60,000 students. And we set a fairly ambitious goal of making sure that we could open and open early and make sure that, that was a selling point for all of our homebuilders, and we were able to achieve that this year. So we did open up those grades. I was I was privileged to be able to cut the ribbon on that and open upgrades through. We have something like 400 students there with a weighted percentage of those students walking to school from our community, but we're drawing from all over. And so we get we're getting students coming in from all aspects of the Denver area and really liking the model that we have with that school.

所以我們出去在特許學校的機會上[親吻]了很多[青蛙]，最終與真正的印刷品合作。國家遺產學院是一組總部位於密西根州的特許學校，在 9 個州擁有 100 多所學校，擁有 60,000 名學生。我們設定了一個相當雄心勃勃的目標，確保我們能夠開業並提前開業，並確保這是我們所有房屋建築商的一個賣點，我們今年能夠實現這一目標。所以我們確實開放了這些成績。我很榮幸能夠剪綵並開放升級。我們那裡有大約 400 名學生，其中一部分學生是從我們社區步行上學的，但我們是從各地抽取的。因此，我們發現來自丹佛地區各個方面的學生都非常喜歡我們學校的模式。

So continuing with that, what our objectives here is we have a full K-12 campus and we're the first K-12 campus for NHA in this -- in their national platform. They're very excited about it. They've got other K-12 campuses that they've got planned and are working towards, but we were their first K-12 campus and we'll start -- not to rest on our laurels on opening the first phase of that school. But really, we'll start working on the high school portion of that with the planned opening of the high school in August of 2025, such that our seventh graders will be able to go to 8th grade at the existing school and then transition directly into high school for 9 through 12 grades. But we're very excited about that opening of the high school -- I mean that's school.

因此，繼續說下去，我們的目標是擁有一個完整的 K-12 校園，並且我們是 NHA 在其國家平台上的第一個 K-12 校園。他們對此感到非常興奮。他們已經計劃並正在努力建造其他 K-12 校區，但我們是他們的第一個 K-12 校區，我們將開始——不要滿足於開設該學校第一階段的成就。但實際上，我們將開始研究高中部分，並計劃於 2025 年 8 月開設高中，這樣我們的七年級學生將能夠在現有學校升入八年級，然後直接過渡到高中9至12年級。但我們對高中的開學感到非常興奮——我的意思是這就是學校。

That's great. And good to hear that you guys are making progress in that area. I'm sorry, one more question came to mind, something you've talked about in the past, just for an update. What about a big box store locating in proximity you probably have some retail by now in Sky Ranch or you don't but (inaudible) Kroger and..

那太棒了。很高興聽到你們在該領域取得了進展。抱歉，我又想到了一個問題，這是您過去討論過的問題，只是為了更新。位於附近的大賣場怎麼樣，您現在可能在天空牧場有一些零售店，或者您沒有，但（聽不清楚）克羅格和..

We have. We have big box Kroger, big box retailers, whether that's a Lowe's or Home Depot or Walmart, any number of those. And surprisingly, they're looking. I'm trying to work on incentivizing some of those folks to come on and they're sort of saying, listen, there's really not much you can do to incentivize us. We're looking at rooftops, we're looking at pull within the region. We're looking at infrastructure and all those sorts of things. And so we do have a good land plan for that commercial.

我們有。我們有大型克羅格、大型零售商，無論是勞氏、家得寶或沃爾瑪，等等。令人驚訝的是，他們正在尋找。我正在努力激勵其中一些加入進來，他們會說，聽著，你真的無能為力來激勵我們。我們正在研究屋頂，我們正在研究該地區的吸引力。我們正在研究基礎設施和所有類似的事情。所以我們確實為該廣告製定了良好的土地規劃。

Our residents are dying to get grocery and a fuel station there, but we're probably still 18 months, 2 years out from getting some of that stuff into a groundbreaking form. But there is a lot of interest and a lot of folks. We -- it isn't that we're not talking to them. We are. They're putting pins in it. They really want to be here. But they need a little bit more rooftops to be able to get their flag in the ground on those.

我們的居民非常希望那裡能有雜貨店和加油站，但我們可能還需要 18 個月甚至 2 年的時間才能將其中一些東西變成突破性的形式。但有很多興趣和很多人。我們——並不是不要與他們交談。我們是。他們正在往裡面放別針。他們真的很想來這裡。但他們需要更多的屋頂才能將他們的旗幟插在地上。

In other words, everybody wants to be first, to be second.

換句話說，每個人都想成為第一，成為第二。

That's a great way to present it.

這是展示它的好方法。

Okay. And just lastly, just a comment, glad to see you guys started on the share repurchase, and I think that's a great validation of your model and cash flow -- capabilities. So I'll pass it on. Good to hear from you.

好的。最後，只是發表評論，很高興看到你們開始進行股票回購，我認為這是對你們的模型和現金流能力的很好驗證。所以我會把它傳承下去。很高興聽到你的消息。

Your next question is coming from Bill Cunningham, who's a private investor.

你的下一個問題來自比爾‧坎寧安，他是一位私人投資者。

Mark, I had -- actually, my first question was going to be about commercial, which you just mostly answered -- but I do remember during your Investor Day, I think you made some general comments about the southern section of that commercial being possibly some sort of apartment development which I think was a fairly significant number possibly. I wondered if you might be able to say anything about that.

馬克，我——實際上，我的第一個問題是關於商業廣告的，你剛剛回答了這個問題——但我確實記得在你的投資者日期間，我認為你對該廣告的南部部分可能做了一些一般性評論某種公寓開發項目，我認為這可能是一個相當大的數字。我想知道你能否對此說點什麼。

Yes. We do have a placeholder for that and can go somewhere between 400 and 600 multifamily units there. And it's a good spot for it because not only does it add density -- and that helps us in terms of assessed value and mill levies and taxes that help us with the reimbursables. But it's also a great spot for us on the transitioning between commercial and detached residential. So it will be right along that southern border of that. And you're right.

是的。我們確實有一個佔位符，可以在那裡放置 400 到 600 個多戶單元。這是一個很好的地方，因為它不僅增加了密度，而且在評估價值和工廠徵稅方面對我們有幫助，從而幫助我們償還費用。但對我們來說，它也是商業和獨立住宅之間過渡的好地方。所以它將位於該地區的南部邊界。你是對的。

I get lots of interest from folks on that. And really, we want to be a little bit more mature before we put that product up, because we want to be we're looking at kind of that being another one of the affordability factors in there. We want to make sure that that's an opportunity for folks that can transition from. And as we look at it, transition from a multifamily to a single family, multifamily rental to a single-family rental to a single-family house, and really doing that all within the same community and the same opportunity. And so good that you continue to highlight that, and I apologize for not being more specific about that in some of my commercial detail.

人們對此很感興趣。事實上，我們希望在推出產品之前變得更加成熟，因為我們希望將其視為其中的另一個可承受性因素。我們希望確保這對那些可以從中過渡的人來說是一個機會。正如我們所看到的，從多戶住宅過渡到單戶住宅，從多戶出租過渡到單戶出租，再過渡到單戶住宅，並且真正在同一個社區和相同的機會內做到這一點。太好了，您繼續強調這一點，我很抱歉沒有在我的一些商業細節中更具體地說明這一點。

No, that's fine. I just thought I know you're still working out details. And so that's why I would kind of ask the question the way I did because I know sometimes your plans constantly -- you have to shift things as markets change and what your current thought is and what kind of feedback you're getting. So that's why I kind of asked the open-ended question than I did. So this was very helpful. And also the school -- I mean the apartment location would be directly adjacent to the school site also, right?

不，沒關係。我只是以為我知道你還在研究細節。這就是為什麼我會像以前那樣問這個問題，因為我有時知道你的計劃不斷 - 你必須隨著市場的變化而改變事情，以及你當前的想法是什麼以及你得到什麼樣的反饋。所以這就是為什麼我問了這個開放式問題。所以這非常有幫助。還有學校——我的意思是公寓位置也直接毗鄰學校，對吧？

It would. It's not going to -- it may be some of the units may be directly across the street, but some of them are going to be on kind of the eastern portion of that area really south part of the commercial, north part of the residential.

它會。不會的——有些單元可能就在街對面，但其中一些單元將位於該區域的東部，即商業區的南部，住宅區的北部。

Okay, which is what like a 5-minute walk to school from there?

好的，從那裡步行 5 分鐘到學校怎麼樣？

Yes, yes, exactly.

是的，是的，完全正確。

Yes. So I think -- I guess my point is just it's a very good close location for a dense population to where the school is. So that looks interesting. Go ahead.

是的。所以我想——我想我的觀點是，對於人口稠密的學校來說，這是一個非常好的位置。所以這看起來很有趣。前進。

I was just going to highlight the location of the school is a 5-minute walk for everybody. But it's got to be -- it's a 5-minute walk uphill for everybody.

我只是想強調學校的位置對每個人來說都是 5 分鐘步行路程。但它必須是——每個人步行 5 分鐘上山。

Okay. But going home, it's not though, right?

好的。但回家了，就不是這樣了，對吧？

No, no, it is. it's uphill both ways.

不，不，是這樣。雙向都是上坡。

I'm going to walk in both directions uphill in both directions.

我要沿著兩個方向步行上坡。

It's excellent.

太棒了。

Okay. So the other item that you had pointed out right next to your offices at the Investor Day was that large pad site that you thought, I think work would start there in November was your estimate in July? And I think it was something like maybe 16 wells or something would be drilled there. I'm wondering what things might look like with that at the moment.

好的。那麼，您在投資者日在辦公室旁指出的另一個項目是您認為的大型辦公地點，我認為工作將在 11 月開始，您預計是在 7 月？我認為大概有 16 口井或會在那裡鑽探什麼東西。我想知道目前情況會是什麼樣子。

It is currently fracking.

目前正在進行水力壓裂。

Good.

好的。

And we are delivering water to that one. And then we've got -- I mean, we've had literally our water system on for the entire since really fiscal year-end, all of September. We had a bit of a just because of the technology on that 3-mile lateral. They were on a pad site that was in the city of Aurora that we don't provide because that's a city of Aurora issue. But then they had another -- and then they were rolling off that one to one that was in our service area, and that was the gap because they were having some technical difficulties on it. But you're going to see some pretty healthy revenues on the Q1 call in January on the frack.

我們正在向那個人供水。然後我們——我的意思是，自從財政年度結束以來，整個九月，我們的供水系統實際上一直處於運作狀態。僅僅因為那條 3 英里的橫向公路上的技術，我們就遇到了一些麻煩。他們位於奧羅拉市的一個基地，我們不提供該基地，因為這是奧羅拉市的問題。但後來他們又做了一個——然後他們在我們的服務範圍內推出了一對一的服務，這就是差距，因為他們在這方面遇到了一些技術困難。但在一月份的第一季電話會議上，你會看到一些相當健康的收入。

Right. That's great. Okay. Which is always your slow period on the home sales and things that -- so good. And then let's see, there was -- I think that's it, Mark.

正確的。那太棒了。好的。這始終是房屋銷售和其他事情的淡季——非常好。然後讓我們看看，我想就是這樣，馬克。

Your next question is coming from Bill Miller of Will mill design.

您的下一個問題來自威爾工廠設計公司的比爾米勒。

Mark, have a great quarter and a great year. Congratulations -- also on your repurchase of stock, my goodness, [Chris] that is dramatic. I love it. My question is ...

馬克，祝你有個美好的季度和美好的一年。恭喜你——也恭喜你回購了股票，天哪，[克里斯]這太戲劇性了。我喜歡它。我的問題是...

Well it can be [taught].

嗯，它可以被[教導]。

[It might be taught].

[可能會被教導]。

Well, you might get a different opinion from my wife.

好吧，你可能會從我妻子那裡得到不同的意見。

Well, we didn't ask her this question. The -- you almost always made reference to the acquisition pipeline. And here with interest rates higher homebuilding seemingly, except in Denver, a Scott item on anybody's agenda. What about some of the neighboring land at this point?

好吧，我們沒有問她這個問題。您幾乎總是提到收購管道。除了丹佛以外，這裡的房屋建設似乎隨著利率的上升而出現，這是斯科特在任何人的議程上的一個項目。此時鄰近的一些土地怎麼樣？

So that's a great question, and I do -- it's odd that I keep referencing it nothing happening. But what I can tell you is they also haven't sold anybody else. And so it hasn't hurt us not to have acquired those. And in fact, I think that overall raw land prices have weakened just because interest rates have gone up, and it makes it more difficult for as -- for a typical master plan developer.

所以這是一個很好的問題，我確實這麼做了——奇怪的是我一直提到它卻什麼也沒發生。但我可以告訴你的是，他們還沒有出售過任何其他人。因此，沒有獲得這些並沒有對我們造成傷害。事實上，我認為整體原地價格已經疲軟，只是因為利率上升，這使得典型的總體規劃開發商變得更加困難。

And in our particular case, it's really not that interest rate sensitive because of how we design our product and the price point that we try and compete in. So I would say all of the opportunities that we have been and are continuing to pursue, our continued -- they're still all on the table.

在我們的具體情況下，由於我們設計產品的方式以及我們嘗試競爭的價格點，利率實際上並不那麼敏感。所以我想說，我們已經並正在繼續追求的所有機會，我們的繼續——它們仍然都在桌面上。

Okay. Great. What do you have to pay for your mortgage now? On your homes rent?

好的。偉大的。您現在需要支付什麼抵押貸款？你的房屋租金？

I think we're right -- some of ours, we locked in, I think, four of the units we locked in at that nice attractive interest rate, like 3.5%, something like that. And then the additional 10, I think we're right around 7.5%. So we don't have a builder that wants to buy down our mortgage.

我認為我們是對的——我們中的一些人，我們鎖定了四個單位，我認為我們以有吸引力的利率鎖定了四個單位，例如 3.5% 之類的。然後是另外 10 個，我認為我們的正確率約為 7.5%。所以我們沒有建築商想要買下我們的房貸。

No, that's great. Okay. Well, just keep going, sounds terrific. How are you going to get people to recognize your stock in your company and what you're doing?

不，那太好了。好的。好吧，繼續前進，聽起來棒極了。您將如何讓人們認識到您在公司中的股票以及您正在做的事情？

Well, we're going to -- as you saw with this presentation, we're trying to highlight some of the -- what you all know and have done the work to find out, but really try and highlight the disconnect between legacy asset balance sheet value and earnings and gross margins and return on assets. So we'll continue to do that. I'm out in the circuit doing presentations at some of the conferences and we'll continue to put up good results and shout as loud as we can into the marketplace.

好吧，正如您在本次演示中看到的那樣，我們將嘗試強調一些您都知道並已完成工作來找出答案的內容，但真正嘗試強調遺留資產之間的脫節資產負債表價值、收益、毛利率和資產報酬率。所以我們將繼續這樣做。我在一些會議上進行巡迴演講，我們將繼續取得良好的成果，並盡可能大聲地向市場喊話。

Well, one of you well done, and let's talk in.

好吧，你們中的一個做得很好，讓我們談談。

Your next question is coming from Greg Malachowski from Benchmark.

您的下一個問題來自 Benchmark 的 Greg Malachowski。

I just have one quick question in relation to partially the commercial and then also the apartments that were previously discussed. By nature, these are assets that, I guess, in terms of development are difficult for a lot of people right now just because of rates and how expensive it is for you guys, particularly going out of the loan would obviously be very capital intensive. So where do you guys stand there? Have you given any thought to potentially just partnering with people who maybe want to do some of the development or specialize in building apartments and then kind of sharing the overall intensity of the nature of those projects.

我只是有一個簡單的問題，涉及部分商業，以及之前討論過的公寓。從本質上講，我想，就開發而言，這些資產現在對許多人來說都是困難的，因為利率和對你們來說有多昂貴，特別是貸款顯然是非常資本密集的。那你們站在哪裡？您是否考慮過與可能想做一些開發或專門建造公寓的人合作，然後分享這些專案性質的整體強度。

Obviously, if you partner the potential profit share is less, but if you can say, hey, we've got the land, which for a lot of developers is a pretty big issue right now because land is expensive and rates are high. And they can say, okay, well, if you contribute the land, we can do something on our end and then together, you guys bring some of these products to market. Have you given that any thought versus what you've kind of been doing now where it's mainly you guys carry the brunt of the work and then either get reimbursed through the community developed in the district or through payback from finished lots for builders. Is partnering anything you guys have given any thoughts?

顯然，如果你是合作夥伴，潛在的利潤份額會更少，但如果你可以說，嘿，我們有土地，這對許多開發商來說現在是一個相當大的問題，因為土地昂貴且利率很高。他們可以說，好吧，好吧，如果你貢獻土地，我們可以做一些事情，然後你們一起將其中一些產品推向市場。您是否考慮過您現在所做的事情，主要是您承擔了工作的重擔，然後透過該地區開發的社區或透過建築商完工地塊的回報獲得補償。你們對合作有什麼想法嗎？

Absolutely. In fact, I will tell you that that's likely to be the way we go about it, not only just on the multifamily but a lot of the commercial. We have so much equity in this project. And with a land basis as low as our land basis is and the fact that we can not only leverage less than $1,000 a lot land basis in it, but also leverage the utility side where we've already been able to bring all the utilities there. We have high margin in utilities. And so we bring a wet finish lot to the equation with very, very efficient means on it, right? Because we buy all the wholesale backbone infrastructure already invested.

絕對地。事實上，我會​​告訴你，這很可能是我們處理問題的方式，不僅是在多戶住宅上，而且在許多廣告上也是如此。我們在這個專案中擁有如此多的股權。由於土地基礎與我們的土地基礎一樣低，而且事實上我們不僅可以利用不到 1,000 美元的土地基礎，而且還可以利用公用事業方面，我們已經能夠將所有公用事業帶到那裡。我們在公用事業領域擁有高利潤率。因此，我們以非常非常有效的方式將濕飾面批次納入方程式，對吧？因為我們買了所有已經投資的批發骨幹基礎設施。

We've already gotten paid back some of those reimbursables from those historic investments. So carrying that through, yes, you're right. We can bring that to developer, not only on the multifamily but commercial where they come in, and it doesn't matter. I mean we've got a lot of interest on industrial, where we can get a distribution center out there. And the thinking in on that is we probably need an NOR going to invest in upgrading the interchange. And so we're in the middle of that right now with CDOT on expanding, and it has a government acronym. But we've got a 1601 study underway which will give us a permit for developing interchange. And we want to be early on that. We have mill levies specifically set aside for that, so that doesn't have to come off our balance sheet.

我們已經從這些歷史性投資中收回了部分應付款項。所以堅持下去，是的，你是對的。我們可以將其帶給開發商，不僅是多戶住宅，還有他們所涉足的商業地產，這並不重要。我的意思是我們對工業很感興趣，我們可以在那裡建立一個配送中心。我們的想法是，我們可能需要 NOR 來投資升級交換站。所以我們現在正處於 CDOT 擴張的中間，它有一個政府的縮寫。但我們正在進行一項 1601 研究，該研究將為我們提供發展交流的許可。我們希望儘早實現這一點。我們專門為此撥出了工廠稅，因此不必從我們的資產負債表中扣除。

But distribution center there, where we've got higher capacity and more flexibility on truck access, they go vertical on that. We bring the pad side together with the utilities. They take the vertical investment on the infrastructure they get it fully leased out on major long-term leases, and then we exit together with them on something like that. So we've had some of those conversations. That's kind of the detail of it. That's kind of our thinking on it. where it's not that heavy of a lift from our standpoint because of what we've already done on the site. And to your point, we do benefit from the increased value. So again, it's another way for us to vertically integrate without having significant investment in there and investing in ourselves through partnerships with that. We don't know that business. It may not be something we want to take the hits and bruises on, on learning that business, but there are those that do understand that business and are very good at it.

但在那裡的配送中心，我們擁有更高的容量和更靈活的卡車通道，他們在這方面是垂直的。我們將墊側與公用設施放在一起。他們對基礎設施進行垂直投資，並透過主要長期租賃將其完全出租，然後我們與他們一起退出類似的事情。我們已經進行了一些對話。這就是它的細節。這就是我們對此的想法。從我們的角度來看，由於我們已經在網站上所做的事情，這並不是那麼沉重的提升。就您而言，我們確實從價值的增加中受益。再說一次，這是我們垂直整合的另一種方式，而無需在那裡進行大量投資，並透過與之建立夥伴關係來投資我們自己。我們不知道這個生意。我們可能不想在學習該業務時承受打擊和瘀傷，但有些人確實了解該業務並且非常擅長。

Thank you very much. (Operator Instructions) We have our next question coming from Elliot Knight of Knight Advisors.

非常感謝。 （操作員說明）我們的下一個問題來自 Knight Advisors 的 Elliot Knight。

Elliot, good to hear your voice. Well, 88 years old and still going. That's encouraging.

艾略特，很高興聽到你的聲音。嗯，88歲了，還在繼續。這令人鼓舞。

I'd like to make an observation. You've done an excellent job on this call of illustrating how early in the development stage, the various segments of the business are. And you have built a company this company is extraordinarily well managed. You've built a company that has great financial strength. I really think it's time to get into the early stage of paying a dividend. You and I have talked about this before.

我想做一個觀察。您在這次電話會議上做得非常出色，說明了業務的各個部分處於開發階段的早期階段。你建立了一家公司，這家公司管理得非常好。您已經建立了一家擁有雄厚財務實力的公司。我真的認為是時候進入支付股息的早期階段了。你和我之前已經討論過這個問題。

It could be an annual dividend. But I think it would substantially broaden your potential stockholder base if you didn't have to -- PCYO didn't have to have a star after it saying nondividend-paying company. I wish you'd share that thought with the Board and have them do something about it. Great that you're buying back...

這可能是年度股息。但我認為，如果您不需要的話，這將大大擴大您的潛在股東基礎——PCYO 在表示不派息公司後不必有一顆星。我希望您能與董事會分享這個想法，並讓他們採取行動。太好了，你買回來了...

You bring up a good point. And again, another -- that's another way that we continue to invest in ourselves and our ownership interest of those that own with us. And we do look at that very seriously every year. And as you've seen, our capital allocation strategy is pretty conservative, but we are continuing to build a very liquid balance sheet. When you take a look at the cash and the receivables, having a $50 million liquidity position is pretty healthy.

你提出了一個很好的觀點。再說一次，這是我們繼續投資於我們自己和我們擁有的人的所有權權益的另一種方式。我們每年都會非常認真地看待這個問題。正如您所看到的，我們的資本配置策略相當保守，但我們正在繼續建立流動性很強的資產負債表。當您查看現金和應收帳款時，會發現擁有 5000 萬美元的流動資金狀況相當健康。

We have a disciplined approach and one of those metrics are to make sure that your recurring revenue exceeds your G&A, and we're very close to that, Elliot. And so it's easy for us to waiver beyond established and historic metrics like you can declare a dividend once you're recurring revenue exceeds your G&A. And when that visual is there, maybe that becomes something of heightened consideration. But I do agree with you that we will be declaring dividends, and we will be paying them. And we'll have a new access to people who invest in companies that are dividend pay company. So it will broaden our shareholder group. And it may help resolve some of the things that Greg and Bill and others were talking about on getting the market to appreciate and understand the awareness of the company. And so those are all key ways to do that.

我們有一個嚴格的方法，其中一個指標是確保您的經常性收入超過您的一般管理費用，我們非常接近這一點，艾利奧特。因此，我們很容易放棄超出既定和歷史指標的規定，例如，一旦您的經常性收入超過一般管理費用，您就可以宣布股息。當這種視覺效果出現時，也許這就會變成人們更加關注的事情。但我確實同意你的觀點，我們將宣布並支付股息。我們將有一個新的途徑接觸那些投資股息支付公司的人。因此，這將擴大我們的股東群體。這可能有助於解決格雷格和比爾以及其他人正在討論的一些問題，即讓市場欣賞和理解公司的知名度。因此，這些都是實現這一目標的關鍵方法。

Well, that's what we all want -- and my comments included the comment of the financial strength to which you are now alluding. And that's the reason why I think the company is in a position to pay a small dividend. That's all. (inaudible) I love income.

嗯，這就是我們都想要的——我的評論包括你現在提到的財務實力的評論。這就是為什麼我認為該公司有能力支付小額股利的原因。就這樣。 （聽不清楚）我喜歡收入。

Well, it's 60%, I do too.

嗯，是60%，我也是。

Thank you very much. Well, that appears to be all the questions that we have in the queue at the moment. I'm going to hand back over to Mark for any closing comments.

非常感謝。嗯，這似乎是我們目前隊列中的所有問題。我將把最後的評論交還給馬克。

So again, a terrific quarter, as you guys can see from the presentation, really -- we do have a lot of pedal in our assets, and we're starting to use that. We're starting to press a little of those. We'll have some overlapping segments of the land development side. We continue to press on expanding our portfolio of the SFRs. So we're continuing to invest in that on that side of it.

再說一遍，這是一個很棒的季度，正如你們從演示中看到的那樣，我們的資產確實有很多踏板，而且我們正在開始使用它。我們開始施壓其中一些。我們在土地開發方面會有一些重疊的部分。我們將繼續努力擴大 SFR 的產品組合。因此，我們將繼續在這方面進行投資。

And then continuing to invest on delivering more water to our industrial customers to make sure that we can continue to capitalize on that demand for oil and gas as they continue to build out that field. So all three of those areas, we are expanding and continuing to invest in and really continuing to appreciate and respect the health of the liquidity and the strength of the balance sheet. So with that, we'll look to leverage that in some acquisitions and really continue to add to the pipeline of opportunities for the company. For those that are missing our early morning presentation and picking up on this and have a question as a result of the call or the slides, Don't hesitate to give me a holler. And we will look forward to several major market visits. I'll be back in New York probably after the first of the year and see if we can do another kind of Q&A session at the NASDAQ for some of that for our New York family and the other major metropolitan markets across the country.

然後繼續投資為我們的工業客戶提供更多的水，以確保我們能夠在他們繼續建造該領域時繼續利用對石油和天然氣的需求。因此，在所有這三個領域，我們都在擴大並繼續投資，並真正繼續欣賞和尊重流動性的健康狀況和資產負債表的實力。因此，我們將尋求在一些收購中利用這一點，並真正繼續為公司增加機會。對於那些錯過我們清晨演示並注意到這一點並因電話或幻燈片而有疑問的人，請隨時向我詢問。我們將期待幾次主要的市場訪問。我可能會在今年年初後回到紐約，看看我們是否可以在納斯達克舉行另一種問答會議，為我們的紐約家族和全國其他主要大都市市場提供一些幫助。

So with that, I wish you all and your families a terrific holidays, and we look forward to continued success in '24. Thanks very much.

因此，我祝福大家和家人度過一個愉快的假期，我們期待 24 年繼續取得成功。非常感謝。

Thank you very much, everyone. That does conclude today's conference call. You may disconnect your phone lines at this time, and have a wonderful day. Thank you for your participation.

非常感謝大家。今天的電話會議到此結束。此時您可以斷開電話線，度過美好的一天。感謝您的參與。

Thank you, Jenny.

謝謝你，珍妮。

Thank you, everyone. Take care.

謝謝大家。小心。