Mills Music Trust Reports Decrease in Cash Receipts and Suspends Distributions for First Half of 2025

Mills Music Trust reported its financial results for the three and six months ended June 30, 2025, revealing a total cash receipt of $202,850 from EMI Mills Music Inc. for the first quarter of 2025, a decrease from $248,922 received in the same period of the previous year. For the six months ending June 30, 2025, total receipts amounted to $463,609, down from $537,349 in the prior year. The Trust's administrative expenses for the first half of 2025 were $325,622, compared to $249,343 for the same period in 2024, leading to a balance available for distribution of $138,033 at the end of June 2025.

The Trust did not distribute any cash to unit holders during the reported periods, maintaining a reserve of $138,033 for potential future administrative expenses and liabilities. This decision follows a trend from the previous year, where cash distributions were also suspended. The Trust's cash distributions per unit were $0.00 for the three months ended June 30, 2025, and $0.48 for the same period in 2024, reflecting a significant change in distribution policy as the Trust prioritizes financial reserves.

Operationally, the Trust continues to rely on EMI for the collection of royalties from its music catalogue, which consists of over 12,000 titles. Approximately 1,430 of these titles generated royalty income in recent years. The Trust's income is contingent on EMI's ability to maintain its rights to the catalogue, which is subject to various copyright laws and potential disputes regarding payment calculations. The Trust has identified underpayments from EMI totaling $1,559,321, which remain unresolved as EMI disputes the Trust's claims.

Looking ahead, the Trust's management has indicated that it will continue to assess its financial needs regarding future administrative expenses before making any distributions to unit holders. The ongoing disputes with EMI regarding the calculation of the Contingent Portion payments and the findings of a special audit conducted by Citrin Cooperman & Company LLP may impact future cash flows. The Trust has extended a tolling agreement with EMI to address these disputes, but there is no assurance that the Trust will recover any of the identified underpayments or resolve the ongoing disagreements effectively.