MV Oil Trust Reports 46% Decline in Income and Cash Distributions in Q1 2025

MV Oil Trust reported a significant decline in financial performance for the first quarter of 2025, with income from net profits interest totaling $2,992,742, down from $5,559,056 in the same period of 2024. This represents a decrease of approximately 46% year-over-year. The Trust's total assets also decreased to $3,322,228 as of March 31, 2025, compared to $3,865,849 at the end of 2024. The decline in income was primarily attributed to a $3,207,892 reduction in excess revenues over direct operating expenses and lease equipment and development costs, which fell to $3,740,927 from $6,948,819 in the prior year.

The Trust's cash distributions to unitholders also saw a notable decrease, with the first quarterly distribution of 2025 amounting to $2,760,000, or $0.240 per Trust unit, compared to $5,347,500, or $0.465 per Trust unit, in the first quarter of 2024. This reduction in distributions reflects the overall decline in income and the Trust's ongoing administrative expenses, which increased to $390,628 from $314,712 year-over-year. The Trust's corpus at the end of the first quarter of 2025 was $3,322,228, down from $4,940,153 a year earlier.

Operationally, the Trust continues to rely on its passive net profits interest, which entitles it to receive 80% of the net proceeds from MV Partners' oil and gas production in the Mid-Continent region. As of March 31, 2025, the Trust has received payments for 80% of the net proceeds from the sale of 14.8 million barrels of oil equivalent since its inception. However, the Trust is set to terminate on June 30, 2026, as it has met the minimum production threshold required for the net profits interest. The final quarterly cash distribution to unitholders is anticipated shortly after this termination date.

Looking ahead, the Trust's financial outlook remains cautious, with the potential for further declines in income and distributions as production from the underlying properties continues to diminish. The Trust has established a capital reserve of $1,000,000 to mitigate the impact of uneven capital expenditure timing, but the overall market conditions and production levels will significantly influence future cash flows. The Trustee has indicated that it will continue to monitor expenses and distributions closely, with the possibility of adjusting cash reserves as necessary.