Financial Performance - Mesabi Trust received a final award of $59,799,977 for underpaid royalties from Cleveland-Cliffs Inc. and Northshore Mining Company, plus pre-award interest of $11,288,269[24]. - The total payment received by Mesabi Trust on October 4, 2024, was $71,185,029, satisfying the AAA panel's unanimous award for underpayment of royalties[27]. - Mesabi Trust's revenue, operating profits, and assets are primarily derived from one business segment—iron ore mining[12]. - The Trust's financial statements are presented on pages F-4 through F-14 of the Annual Report[35]. - The financial statements for the years ended January 31, 2025, and 2024, are incorporated in the report, providing a comprehensive view of the Trust's financial performance[91]. - The Trust's financial statements include balance sheets, income statements, and cash flow statements, essential for evaluating its financial position and performance trends[91]. Governance and Management - The Trustees held 12 meetings in fiscal 2025, with all Trustees attending at least 75% of the meetings[51]. - Each individual Trustee received total compensation of $51,331 during fiscal 2025[67]. - The Corporate Trustee earned $118,301 in total compensation for the fiscal year ended January 31, 2025[69]. - Each Trustee receives at least $20,000 in annual compensation, adjusted based on the All Commodities Producer Price Index[67]. - The Corporate Trustee received $62,500 annually for clerical and administrative services, in addition to other fees[69]. - The report includes a summary of the Trustees' compensation, reflecting the governance and management structure of the Trust[93]. Audit and Compliance - Mesabi Trust has engaged Boulay, PLLP as its independent registered public accountant following the non-reappointment of Baker Tilly US, LLP[36]. - The aggregate audit fees for fiscal 2025 were $92,023, an increase from $80,523 in fiscal 2024, representing a growth of approximately 15.7%[84][85]. - No fees were paid for tax compliance, tax advice, or tax planning for fiscal 2025 or fiscal 2024, indicating a focus on audit-related services only[88]. - The Trustees approved 100% of all services provided by Boulay and Baker Tilly during fiscal 2025 and fiscal 2024, ensuring full oversight of audit engagements[89]. - The audit-related fees for fiscal 2025 and fiscal 2024 were not applicable, indicating a streamlined focus on core audit functions without additional assurance services[87]. Cybersecurity and Risk Management - The Corporate Trustee has implemented a cyber risk management program to address cybersecurity threats, which could materially affect financial condition and results of operations[20]. - The Trust has not experienced any material adverse effects from prior cybersecurity incidents on its financial condition or results of operations[20]. Trust Structure and Operations - The Trust's activities are limited to collecting income, paying expenses, and distributing net income to the holders of Trust Certificates[48]. - The Trust does not have any compensation plans under which securities of the Trust are authorized for issuance[75]. - The Trust maintains a written related person transaction approval policy for financial transactions involving related persons[78]. - There were no related person transactions required to be disclosed in the Annual Report for the fiscal years ended January 31, 2025 and 2024[80]. - The Trust is exempt from certain corporate governance standards due to its legal structure as a pass-through royalty trust, which may impact its operational flexibility[83]. - The Trust's legal structure allows it to bypass certain regulatory requirements, potentially enhancing its operational efficiency and strategic decision-making[83]. - The Trust's annual report for the fiscal year ended January 31, 2025, is filed herewith, providing detailed insights into its financial health and operational strategies[93].

Distribution Information - Mesabi Trust declared a distribution of $0.56 per Unit of Beneficial Interest, an increase from $0.29 per Unit for the same period last year, reflecting a growth of 93.1%[5] - The distribution is payable on May 20, 2025, to Unitholders of record at the close of business on April 30, 2025[5]

Group 1 - The Value Lab focuses on long-only value investment ideas, aiming for a portfolio yield of approximately 4% and has performed well over the last five years by engaging in international markets [1][2] - Mesabi Trust's lands are experiencing increased utilization following Cleveland-Cliffs Inc.'s production activities, which led to a significant stock price increase of around 20% after arbitration results [2] - The Valkyrie Trading Society consists of analysts sharing high-conviction investment ideas that are expected to yield non-correlated and outsized returns in the current economic environment, emphasizing long-only investment strategies [3]

Distribution Information - Mesabi Trust declared a distribution of $5.95 per Unit of Beneficial Interest, payable on February 20, 2025, to unitholders of record on January 30, 2025[5] - The current distribution of $5.95 represents a significant increase compared to the $0.37 per Unit distribution declared for the same period last year, marking an increase of approximately 1514%[5]

Financial Performance - Total revenues for the three months ended October 31, 2024, were $79,001,840, a significant increase from $4,896,066 in the same period of 2023, representing a growth of approximately 1515%[14] - Net income for the nine months ended October 31, 2024, was $87,207,203, compared to $14,292,545 for the same period in 2023, indicating an increase of about 510%[14] - The Trust's net income for the three months ended October 31, 2024, was $78,325,525, reflecting a strong performance compared to previous periods[52] - Net income for the three months ended October 31, 2024, was $78,325,525, a significant increase of 1,818.5% compared to $4,086,066 for the same period in 2023[90] - Total revenues for the nine months ended October 31, 2024, were $91,742,322, a substantial increase from $16,634,160 in the prior year[92] Royalty Income - Royalty income for the three months ended October 31, 2024, was $7,348,366, up from $4,664,092 in 2023, reflecting a growth of approximately 57%[14] - The Trust's royalty income for the nine months ended October 31, 2024, totaled $19,613,693, compared to $16,106,008 in 2023, reflecting an increase of approximately 31%[30] - Total royalty income for the three months ended October 31, 2024, increased by $2,684,274 to $7,348,366 compared to the same period in 2023, driven by higher pricing and shipments of iron ore[84] - For the nine months ended October 31, 2024, total royalty income increased to $19,613,693, up 21.5% from $16,106,008 in the prior year[88] Cash and Reserves - The Trust's cash and cash equivalents increased to $95,910,149 as of October 31, 2024, compared to $23,980,448 at the beginning of the period, marking a rise of about 300%[20] - The unallocated reserve increased significantly to $95,324,736 as of October 31, 2024, compared to $20,975,143 at the beginning of the period, indicating a growth of approximately 354%[20] - As of October 31, 2024, the Trust's unallocated cash and cash equivalents amounted to $90,793,345, a significant increase from $19,126,044 as of January 31, 2024[52] - Accrued Income Receivable rose to $3,883,400 as of October 31, 2024, a 106.0% increase from $1,885,432 a year earlier[97] Distributions - Distributions to unitholders for the nine months ended October 31, 2024, amounted to $12,595,210, with distributions declared and payable at $5,116,804[23] - The Trustees declared a distribution of $0.39 per Unit of Beneficial Interest, totaling $5,116,804, payable on November 20, 2024, compared to $0.35 per Unit for the same quarter in 2023[46] - Mesabi Trust declared a distribution of $0.39 per Unit of Beneficial Interest for November 20, 2024, an increase from $0.35 per Unit for the same period last year, reflecting a growth of approximately 11.4%[107] Arbitration and Legal Matters - The Trust received an arbitration award of $71,185,029 during the nine months ended October 31, 2024, which was not present in the same period of 2023[14] - The Trust received a final arbitration award of $71,185,029 on October 4, 2024, which includes $59,799,977 for underpaid royalties and $11,385,052 in pre-award interest[39][40] - The arbitration initiated by the Trust in October 2022 concluded in June 2024, focusing on royalty underpayments[136] - The Tribunal denied the Trust's request for declaratory relief regarding the timing of royalty obligations accrual[138] Operational Insights - For the three months ended October 31, 2024, production and shipments of iron ore pellets totaled 1,066,665 tons, an increase from 918,482 tons in the same period of 2023, reflecting higher demand[78] - For the nine months ended October 31, 2024, production and shipments reached 3,019,695 tons, up from 2,123,063 tons in the comparable period of 2023, due to three full quarters of operations after the restart in April 2023[79] - Cliffs has treated Northshore as a swing operation since April 2023, with no specific production volume information provided to the Trustees[75] - The Trust's revenue is highly dependent on Northshore's operations, which are influenced by market demand and pricing adjustments under customer contracts[62][71] Financial Management - The Trust's financial statements are prepared on an accrual basis, and distributions are declared based on actual royalties received[45] - The Trustees have invested the AAA award funds in interest-bearing accounts while holding them in reserve pending procedural deadlines related to the arbitration[109] - There were no changes in the Trust's internal control over financial reporting during the last fiscal quarter that materially affected its operations[133] - The Trust's disclosure controls and procedures were evaluated and deemed effective by the Trustees[132] Regulatory and Risk Factors - The Trust is subject to extensive regulation under the Securities Act and the NYSE, but is exempt from many corporate governance requirements due to its nature as a pass-through royalty trust[123] - Variations in royalties received by Mesabi Trust can be significant and are influenced by multiple factors, including operational decisions by Cliffs and market conditions[105] - Future distributions to Unitholders may vary significantly and could be negatively impacted by price adjustments in royalties[119] - There have been no material changes in the Trust's risk factors as outlined in previous reports[141]

Distribution - Mesabi Trust declared a distribution of $0.39 per Unit of Beneficial Interest, an increase from $0.35 per Unit for the same period last year[4] - The distribution reflects the Trustees' decision to hold funds in reserve pending procedural deadlines related to the arbitration[5] Arbitration and Payments - The Trust received a payment of $71,185,029 from Northshore Mining Company and Cleveland-Cliffs Inc. as a result of an arbitration award for underpayment of royalties[5]

Production and Shipments - For the three months ended July 31, 2024, production and shipments of iron ore pellets totaled 974,532 tons, a decrease from 1,049,281 tons in the same period of 2023, attributed to lower demand from Northshore's customers [49]. - Iron ore pellet production and shipments for the six months ended July 31, 2024 totaled 1,953,030 tons, an increase of 62.0% from 1,204,581 tons in the same period of 2023 [51]. - The volume of iron ore shipped by Northshore in Q2 2024 was 949,718 tons, an increase from 886,301 tons in Q2 2023, reflecting a year-over-year growth of approximately 7.1% [68]. Revenue and Income - The Trust's revenue is highly dependent on Northshore's activities, with leasehold royalty income being the principal source of revenue [36]. - For the three months ended July 31, 2024, total royalty income decreased by $3,475,877 to $6,254,719 compared to the same period in 2023, primarily due to a decrease in pricing and shipments of iron ore [51]. - Net income for the three months ended July 31, 2024 was $5,397,894, a decrease of $3,785,446 compared to $9,183,340 in the same period of 2023 [55]. - Total revenues for the six months ended July 31, 2024 increased to $12,740,480, up from $11,738,090 in the same period of 2023, reflecting a growth of 8.6% [56]. - The Trust's expenses for the six months ended July 31, 2024 were $3,858,802, an increase of $2,327,191 compared to $1,531,611 in the same period of 2023 [56]. - The base overriding royalties for the six months ended July 31, 2024 increased by $646,245 to $6,981,711 compared to $6,335,466 in the same period of 2023 [54]. Royalty Structure - The minimum advance royalty for calendar year 2024 is set at $1,129,615, an increase from $1,100,498 in 2023 [39]. - The Adjusted Threshold Price for royalty bonuses in 2024 is $67.75 per ton, up from $66.00 per ton in 2023 [37]. - 97.4% of all iron ore products shipped during calendar 2023 were sold at prices above the Adjusted Threshold Price, indicating strong pricing performance [44]. - The royalty rates for base overriding royalties range from 2.5% for the first one million tons shipped annually to 6% for all tons exceeding four million tons [36]. - The royalty bonus percentage ranges from 0.5% for sales between the Adjusted Threshold Price and $2.00 above it, to 3% for sales $10.00 or more above the Adjusted Threshold Price [37]. - The current royalty rate schedule has been effective since August 17, 1989, and is based on both the volume and selling price of iron ore products shipped [40]. Trust Operations and Distributions - The Trust declared a distribution of $0.30 per unit on July 12, 2024, payable on August 20, 2024, compared to no distribution in the same quarter of 2023 [57]. - Unallocated Reserve increased from $21,644,693 as of July 31, 2023 to $22,116,015 as of July 31, 2024, reflecting a growth of 2.2% [61]. - Accrued Income Receivable increased by 42.6% to $2,584,690 as of July 31, 2024, compared to $1,812,600 as of July 31, 2023 [62]. - The Trust's net income per unit decreased by $0.2885 to $0.4114 per unit for the fiscal quarter ended July 31, 2024 compared to the same quarter in 2023 [56]. - The Trust's distributions can vary significantly from quarter to quarter, influenced by factors such as production schedules, customer demand, and market conditions [80]. Operational Challenges and Legal Matters - Northshore's operations were idled from May 1, 2022, until April 2023, with a partial restart announced on April 25, 2023 [45]. - Cliffs has indicated that Northshore will continue to operate at less than full capacity for the remainder of 2023, with no specific updates on expected shipments for 2024 [70]. - The Trust's royalty income is highly dependent on the volume of iron ore shipments and sales by Northshore, which can fluctuate significantly due to various operational and market factors [69]. - The Trustees are focused on maintaining adequate reserves while balancing distributions to Unitholders, given the unpredictable nature of the iron ore and steel industry [66]. - Cliffs has shifted its focus away from marketing and selling iron ore pellets to third-party customers, impacting the royalty structure and potential income for the Trust [78]. - The Trust initiated arbitration against Northshore and Cliffs for underpayment of royalties from 2020 to 2022, seeking damages [93]. Internal Controls and Compliance - The Trust's disclosure controls and procedures are deemed effective based on the Trustees' evaluation [91]. - There were no changes in the Trust's internal control over financial reporting that materially affected its operations during the last fiscal quarter [91]. - The Trust continues to evaluate whether transactions meet the Royalty Agreement requirements, which could affect royalty calculations [98].

Distribution - Mesabi Trust declared a distribution of $0.30 per Unit of Beneficial Interest, payable on August 20, 2024[11] - This distribution compares to no distribution declared for the same period last year, indicating a significant improvement[11]

Financial Performance - Total revenues for the three months ended April 30, 2024, were $6,250,572, a significant increase of 238% compared to $1,848,849 in the same period of 2023[15]. - Royalty income reached $6,010,608, up 251% from $1,711,316 in the prior year[26]. - Net income for the quarter was $3,483,785, representing a 241% increase from $1,023,139 in the same quarter of 2023[15]. - The net income per unit increased to $0.2655 from $0.0780 year-over-year[15]. - The Trust's expenses for the three months ended April 30, 2024, were $2,766,787, an increase of $1,941,077 from $825,710 in the same period of 2023, primarily due to higher legal fees[67][68]. - Total royalty income for the three months ended April 30, 2024, increased by $4,299,292 to $6,010,608 compared to $1,711,316 in the same period of 2023, driven by increased production and shipments[63][66]. - Base overriding royalties rose to $3,417,645, up from $961,798, while bonus royalties increased to $2,450,133 from $707,840 for the same periods[66]. - Net income for the three months ended April 30, 2024, was $3,483,785, an increase of $2,460,646 compared to $1,023,139 in the same period of 2023[67][68]. Distributions - Distributions declared per unit were $0.2900, compared to no distributions in the same quarter of 2023[15]. - The Trust declared distributions of $0.2900 per unit for the quarter ended April 30, 2024, totaling $3,804,803[40]. - The Trust declared a distribution of $0.29 per unit payable on May 20, 2024, compared to no distribution in the same quarter of 2023[68]. - The Trust declared a distribution of $0.29 per Unit of Beneficial Interest, payable on May 20, 2024, reflecting an increase from no distribution in April 2023[83][84]. Cash and Assets - Cash and cash equivalents at the end of the period were $21,629,973, down from $23,980,448 at the beginning of the period[18]. - As of April 30, 2024, the Trust's unallocated cash and cash equivalents were $17,825,170, down from $19,126,044 as of January 31, 2024, reflecting a decrease of approximately 6.8%[40]. - The Trust's unallocated reserve balance as of April 30, 2024, was $20,654,125, a decrease from $20,975,143 as of January 31, 2024[40]. - The increase in unallocated cash and cash equivalents was 36.0%, rising to $17,825,170 as of April 30, 2024, from $13,102,857 as of April 30, 2023[73]. - Accrued Income Receivable rose by 31.8% to $1,828,842 as of April 30, 2024, compared to $1,387,449 as of April 30, 2023[73]. Operations and Production - For the three months ended April 30, 2024, iron ore pellet production and shipments totaled 978,498 tons, a significant increase from 155,300 tons in the same period of 2023, reflecting a full quarter of operations[61][62]. - The volume of iron ore shipped by Northshore during the first calendar quarter of 2024 was 1,006,692 tons, compared to zero tons shipped in the same quarter of 2023[79]. - Approximately 97.4% of iron ore products shipped in 2023 were sold at prices above the Adjusted Threshold Price, indicating strong market performance[57]. - The Trust's financial performance is highly dependent on Northshore's operations, with royalty rates influenced by the volume and selling price of iron ore products shipped[46]. Liabilities and Contracts - Total liabilities decreased to $4,477,027 from $5,715,206 at the end of January 2024[18]. - The Trust recorded a net contract asset of $1,559,969 as of April 30, 2024, compared to $451,896 as of January 31, 2024[34]. - The minimum advance royalty for calendar year 2024 is set at $1,129,615, an increase from $1,100,498 in 2023[53]. - The royalty bonus threshold price for 2024 is set at $67.75 per ton, up from $66.00 per ton in 2023[31]. - The Adjusted Threshold Price for royalty bonuses in 2024 is $67.75 per ton, up from $66.00 per ton in 2023[53]. Market and Operational Risks - The Trustees noted that uncertainties related to Cliffs' operations and market conditions could affect future royalty payments and distributions[86][87]. - Cliffs has indicated intentions to limit third-party sales of iron ore products, which may impact the calculation of royalties owed to the Trust[80]. - The Trustees have not received specific updates on Cliffs' plans for Northshore operations for the current year, leading to uncertainties in expected shipments[82]. - Future distributions will be highly dependent on royalty income and the level of Trust expenses, with potential uncertainties due to market conditions and operational decisions[75]. Regulatory and Compliance - The Trust's operations are subject to extensive regulation, and it is exempt from many corporate governance requirements due to its nature as a pass-through royalty trust[95]. - The Trust is not taxable as a corporation, and all net taxable income is attributed directly to Unitholders for tax purposes[99]. - The Trust's financial reporting is subject to oversight by independent consultants who verify production and shipping data[104]. - Cliffs has started reporting mine safety results at Northshore as required by the Dodd-Frank Act[114]. Legal Matters - Mesabi Trust initiated arbitration against Northshore and Cliffs for underpayment of royalties from 2020 to April 2022, seeking damages and declaratory relief[109]. - The arbitration evidentiary hearing took place in March 2024, with post-hearing briefs exchanged in May 2024[109]. Governance and Internal Controls - The Trust's disclosure controls and procedures have been evaluated and deemed effective by the Trustees[105]. - There were no changes in the Trust's internal control over financial reporting that materially affected its operations during the last fiscal quarter[106]. - The Trust employs certified public accountants and geological consultants to ensure the accuracy of financial disclosures[103].

Core Viewpoint - Mesabi Trust (NYSE:MSB) is experiencing a potential turnaround due to the unexpected absence of recessionary demand for iron ore and a breakout in commodity prices since March 2024, making it an attractive investment opportunity [3][4]. Upside Arguments - Cleveland-Cliffs has resumed mining operations at Mesabi's main royalty assets, which could enhance revenue generation [4]. - The U.S. Federal Reserve is likely to maintain interest rates, potentially leading to increased revenues and higher iron ore prices [4]. - China's economy may be bottoming out, with record iron ore imports in 2023, suggesting improved demand dynamics [4]. - Ongoing arbitration regarding underpaid royalties could result in favorable outcomes for Mesabi Trust [4]. Dividend Outlook - Mesabi Trust has a historical dividend yield of approximately 5.83%, with expectations of a forward yield of around 6% based on current production rates and ore pricing [6][7]. - The trust has a track record of increasing dividend payouts in line with iron ore prices, with dividends rising to over $5 annually during recent highs [6][7]. Technical Analysis - The stock has shown low volatility since May 2023, indicating a stable base formation, with positive trading indicators suggesting potential upward movement in iron ore prices [7][8]. Historical Performance - Over the past decade, Mesabi Trust has delivered a total return of 106.6%, outperforming various Treasury investments [11]. - The trust has proven to be a strong diversification option for yield generation, with significant potential for capital appreciation during favorable market conditions [11][12]. Conclusion - Mesabi Trust is positioned as a compelling investment choice for those seeking yield and inflation protection, with a recommendation to buy trust units [12].