PURE CYCLE CORP Segments Disclosure
NOTE 13 – SEGMENT REPORTING
An operating segment is defined as a component of an enterprise for which discrete financial information is available and is reviewed regularly by the CODM, or decision-making group, to evaluate performance and make operating decisions. The Company has identified its CODM as its Chief Executive Officer.
Based on the methods used by the CODM to allocate resources, the Company has identified three operating segments which meet GAAP segment disclosure requirements, namely the water and wastewater resource development segment, the land development segment and single-family rental business segment.
The water and wastewater resource development segment provides water and wastewater services to customers for fees. The water is provided by the Company using water rights owned or controlled by the Company, and developing infrastructure to divert, treat and distribute that water and collect, treat, and reuse wastewater. The land resource development segment includes all the activities necessary to develop and sell finished lots, which as of August 31, 2025 and 2024, was done exclusively at the Sky Ranch Master Planned Community. The single-family rental business segment includes single-family homes that the Company has contracted with homebuilders to build on finished lots retained by the Company during its land development activities. The revenue for this segment includes rental income from those homes, which as of August 31, 2025 and 2024 were located exclusively at the Company’s Sky Ranch Master Planned Community.
The Company’s operating segments, as defined in ASC 280, Segment Reporting, reflect how its CODM reviews financial information, makes operating decisions and assesses business performance. In identifying operating segments, the Company also considers its annual budgeting and forecasting process, management reporting structure, and information presented to the Board of Directors. The Company only operates in one geographic region and is not able to be aggregated by geographic operating segments.
The CODM evaluates the performance of the reportable segments based on operating income. Sales, gross margins, and operating expenses are also monitored closely. This information is used to monitor operating margins, measure segment profitability, allocate resources, and make budgeting and forecasting decisions about the reportable segments. The CODM also uses these measures to monitor trends in year over year performance comparisons, sequential quarter performance comparisons, and to compare actual results to forecasts. More disaggregated information about operating expense is generally only reviewed by the CODM on a consolidated basis.
As a result of the Company’s philosophy of maximizing operating efficiencies through the centralization of certain functions, operating income for the reportable segments excludes unallocated corporate overhead costs, depreciation on corporate fixed assets, other costs and other income, as they are not attributable to the individual reportable segments and are included in the corporate line item.
The tables below present the measure of profit and assets as well as the interest income and expense that the CODM uses to assess the performance of the segment for the periods presented:
Year Ended August 31, 2025 | |||||||||||||||
(In thousands) |
| Water and wastewater resource development |
| Land development | Single-family rental |
| Corporate |
| Total | ||||||
Total revenue |
| $ | 10,334 |
| $ | 15,257 | $ | 496 |
| $ | — |
| $ | 26,087 | |
Cost of revenue |
| 3,074 |
| 5,100 |
| 176 |
| — |
| 8,350 | |||||
Depreciation and depletion |
| 1,707 |
| — |
| — |
| — |
| 1,707 | |||||
Total cost of revenue |
| 4,781 |
| 5,100 |
| 176 |
| — |
| 10,057 | |||||
Segment profit | $ | 5,553 | $ | 10,157 | $ | 320 | $ | — | $ | 16,030 | |||||
Interest income | $ | — | $ | — | $ | — | $ | 3,272 | $ | 3,272 | |||||
Interest expense | $ | 151 | $ | — | $ | 273 | $ | 2 | $ | 426 | |||||
Year Ended August 31, 2024 | |||||||||||||||
(In thousands) |
| Water and wastewater resource development |
| Land development | Single-family rental |
| Corporate |
| Total | ||||||
Total revenue | $ | 10,667 | $ | 17,599 | $ | 481 | $ | — | $ | 28,747 | |||||
Cost of revenue |
| 2,922 |
| 4,374 |
| 188 |
| — |
| 7,484 | |||||
Depreciation and depletion |
| 1,504 |
| — |
| — |
| — |
| 1,504 | |||||
Total cost of revenue |
| 4,426 |
| 4,374 |
| 188 |
| — |
| 8,988 | |||||
Segment profit | $ | 6,241 | $ | 13,225 | $ | 293 | $ | — | $ | 19,759 | |||||
Interest income | $ | — | $ | — | $ | — | $ | 2,837 | $ | 2,837 | |||||
Interest expense | $ | 151 | $ | — | $ | 276 | $ | 12 | $ | 439 | |||||
The following table summarizes the Company’s total assets by segment. The assets consist of water rights and water and wastewater systems in the Company’s water and wastewater resource development segment; land, land development costs and deposits in the Company’s land development segment; and the cost of the homes in the single-family rental line. The Company’s other assets (“Corporate”) primarily consist of cash, cash equivalents, restricted cash, equipment, and related party notes receivables.
(In thousands) |
| August 31, 2025 |
| August 31, 2024 | ||
Water and wastewater resource development | $ | 69,366 | $ | 64,616 | ||
Land development | 11,121 | 8,521 | ||||
Single-family rental | 5,280 | 5,371 | ||||
Corporate | 76,512 | 68,846 | ||||
Total assets | $ | 162,279 | $ | 147,354 | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Nov 12, 2025 | Showing above |
| 2024 | Nov 13, 2024 | |
| 2023 | Nov 15, 2023 | |
| 2022 | Nov 14, 2022 | |
| 2021 | Nov 10, 2021 | |
| 2020 | Nov 10, 2020 | |
| 2019 | Nov 12, 2019 | |
| 2018 | Nov 13, 2018 | |
| 2017 | Nov 15, 2017 | |
| 2016 | Oct 28, 2016 | |
| 2015 | Nov 9, 2015 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.