Natural Resource Partners Reports 21% Revenue Decline in Q1 2025

Natural Resource Partners L.P. (NRP) reported a decline in financial performance for the first quarter of 2025, with total revenues and other income amounting to $60.5 million, down from $76.4 million in the same period of 2024. The decrease of approximately 21% was primarily driven by a significant drop in royalty revenues from coal, which fell to $51.3 million from $67.4 million year-over-year. The company’s net income also decreased to $40.3 million, compared to $56.2 million in the prior year, resulting in a basic net income per common unit of $3.01, down from $4.13.

The decline in revenue and profitability can be attributed to lower metallurgical coal sales prices and volumes, which were impacted by soft global steel demand. Operating expenses increased slightly to $17.6 million from $16.7 million, with notable increases in general and administrative expenses. The company also recorded a gain on asset sales of $247,000, contributing to its overall income. Cash flow from operating activities decreased significantly to $34.4 million from $71.5 million in the previous year, reflecting the challenges faced in the coal market.

In terms of strategic developments, NRP continues to explore opportunities in carbon-neutral revenue generation, including carbon sequestration and renewable energy projects. The company maintains a diversified portfolio of mineral properties across the United States, which it believes positions it well for future growth despite current market challenges. As of March 31, 2025, NRP had total liquidity of $120.5 million, consisting of $30.9 million in cash and cash equivalents and $89.6 million in available borrowing capacity under its credit facility.

Operationally, NRP's mineral rights segment reported a 21% decrease in revenues, while the soda ash segment saw a 15% decline, primarily due to changes in the international sales mix. The company’s equity in earnings from its 49% interest in Sisecam Wyoming also decreased, reflecting lower cash distributions received. The total assets of the partnership stood at $772.5 million as of March 31, 2025, with a leverage ratio of 0.7x, indicating a stable financial position relative to its debt obligations.

Looking ahead, NRP anticipates continued pressure on coal prices due to market conditions, but expects some price support from elevated input costs and limited access to capital for operators. The company remains committed to its strategic initiatives in carbon-neutral projects and is focused on maintaining its financial health while navigating the current economic landscape. Future distributions to common unitholders will be determined quarterly, taking into account profitability, cash flow, and market conditions.