Core Viewpoint - Sabine Royalty Trust announced a cash distribution of $0.286230 per unit for March 2026, reflecting an increase due to higher oil production and natural gas pricing [1] Distribution Details - The cash distribution is payable on March 30, 2026, to unit holders of record on March 16, 2026 [1] - This distribution is based on oil production for December 2025 and gas production for November 2025 [1] Production and Pricing - Preliminary production volumes are approximately 49,137 barrels of oil and 931,107 Mcf of gas [1] - Average prices for the current month are approximately $54.40 per barrel of oil and $2.73 per Mcf of gas [1] - The current month's distribution is higher than the previous month due to an increase in oil production and natural gas pricing, despite a decrease in natural gas production and lower oil pricing [1] Comparison with Previous Month - Current Month: - Oil: 49,137 bbls at $54.40 per bbl - Gas: 931,107 Mcf at $2.73 per Mcf - Prior Month: - Oil: 45,316 bbls at $59.01 per bbl - Gas: 1,026,714 Mcf at $2.27 per Mcf [1] Revenue Posting - Approximately $88,300 of revenue received in February will be posted in March, in addition to normal cash receipts [1] - As of the press release, approximately $526,000 in revenue has been received since the close of business in February [1]

Financial Overview - The Trust's total general and administrative expenses for 2025 were $4,090,067, with $556,852 paid to Argent Trust Company as Trustee and $1,670,553 as escrow agent[21]. - The Trust's estimated costs and expenses for 2026 are projected to be approximately $4,450,000[195]. - The Trust's financial statements are prepared on a modified cash basis, differing from GAAP, which may affect revenue recognition and cash reserves[132]. Trust Structure and Governance - As of February 27, 2026, there were 14,579,345 Units outstanding, representing an equal undivided share of beneficial interest in the Trust[35]. - The Trust will exist until it is terminated by two successive fiscal years with gross revenues from Royalty Properties less than $2,000,000 per year[27]. - The Trustee is required to distribute all distributable income of the Trust on a monthly basis[24]. - The Trust's assets consist solely of Royalty Properties and cash held for expenses and distributions[20]. - The Trustee has the discretion to establish a cash reserve for contingent liabilities[24]. - The Trust may not issue additional Units unless approved by at least 80 percent of the outstanding Units[36]. - The Trustee is indemnified out of the Trust's assets for liabilities incurred in the performance of its duties, except in cases of negligence or fraud[26]. - The Trust has no employees, and all administrative functions are performed by the Trustee[23]. - Unit holders have limited voting rights and cannot influence the operations or future development of the Royalty Properties[126]. Distribution and Income - Unit holders are entitled to receive monthly distributions based on the calculated Monthly Income Amount, which is determined by revenues minus expenses and liabilities[37]. - The Monthly Record Date for distributions is the 15th day of each calendar month, with payments made no later than 10 business days after this date[37]. - The Monthly Income Amount distributed to Unit holders is calculated based on cash received from Royalty Properties, reduced by liabilities and cash reserves[207]. - Unit holders are entitled to receive the Monthly Income Amount within 10 business days after the monthly record date, which is the 15th of each month[207]. Taxation and Regulatory Environment - The Trust is classified as a non-mortgage widely held fixed investment trust (WHFIT) for U.S. federal income tax purposes[43]. - Unit holders may be entitled to a percentage depletion deduction if it exceeds cost depletion, which is not limited to the Unit holder's depletable tax basis[52]. - The highest marginal U.S. federal income tax rate applicable to ordinary income is 37%, while the rate for long-term capital gains is 20%[62]. - The Trust is expected to remain exempt from Texas franchise tax as a passive entity, benefiting Unit holders by not subjecting Trust income to individual income tax in Texas[71]. - Florida does not impose an individual income tax, but corporate income tax applies to royalty income allocable to corporate Unit holders from Royalty Properties located within the state[72]. - New Mexico and Oklahoma impose withholding taxes on payments to nonresidents from oil and gas proceeds derived from royalty interests, affecting cash distributions to Unit holders[75]. - The Trust's net proceeds are derived from the sale of depleting assets, and distributions may be considered a return of capital, potentially diminishing tax benefits for Unit holders[120]. - Unit holders must maintain records of their adjusted basis in Trust Units for tax purposes[54]. Environmental and Regulatory Risks - The Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") imposes liability for hazardous substance releases, which could impact the Trust's financial responsibilities[85]. - The production of oil and natural gas is subject to extensive regulations, which may restrict production rates and affect operational costs[78]. - The Federal Energy Regulatory Commission ("FERC") promotes competition in the natural gas market, impacting pricing and sales dynamics for the Trust's Royalty Properties[80]. - Compliance with environmental regulations is expected to impose obligations that may not materially affect the Trust or Unit holders, barring extraordinary events[82]. - The Railroad Commission of Texas (RRC) announced in September 2021 that it will not issue any new saltwater disposal (SWD) well permits in the Gardendale Seismic Response Area (SRA) and will require existing SWD wells in that area to reduce their maximum daily injection rate to 10,000 barrels per day per well[88]. - The U.S. Supreme Court ruled in April 2020 that discharges into groundwater may be regulated under the Clean Water Act if the discharge is the "functional equivalent" of a direct discharge into navigable waters[89]. - The EPA issued draft guidance in November 2023 regarding the regulation of discharges through groundwater, with comments due by December 27, 2023[89]. - The EPA's November 2025 proposed rule aims to further conform the Waters of the United States (WOTUS) definition to the Supreme Court's decision, which could affect regulatory obligations and increase costs for the Royalty Properties[93]. - The Inflation Reduction Act passed in August 2022 included requirements to impose fees on methane emissions from oil and gas operations starting in 2025[97]. - Following the second Trump presidential inauguration, Congress postponed the collection of the Waste Emissions Charge until 2034, which may impact operating costs associated with the Royalty Properties[97]. - The EPA proposed to suspend all GHG reporting for the oil and gas sector until 2034, creating uncertainty about future GHG regulation[97]. - If GHG emission fees or additional permitting are reinstated in the future, such requirements could decrease net revenue to the Trust[97]. - Legal challenges to environmental regulations may create operational delays and increased costs for the Royalty Properties[109]. Commodity Prices and Market Dynamics - The Trust's average per barrel oil price decreased from $77.04 in 2024 to $64.85 in 2025, influenced by higher oil inventories and economic uncertainty[110]. - The average price received for natural gas in 2025 was $2.61 per thousand cubic feet (Mcf), an increase from $1.88 per Mcf in 2024, due to lower supply and stronger seasonal demand[111]. - Crude oil and natural gas prices are volatile, with fluctuations driven by supply and demand dynamics, geopolitical tensions, and economic conditions, impacting the Trust's income and distributions[112]. - The Trust's income is heavily influenced by commodity prices, which may fluctuate widely due to various factors beyond the company's control[112]. - Future commodity prices may be affected by political conditions in major oil-producing regions, particularly in Eastern Europe, the Middle East, and South America[112]. - The implementation of the Waste Prevention Rule could lead to increased compliance costs for operations on federal and Indian lands, affecting the Royalty Properties[101]. - New EPA regulations on methane and VOC emissions are expected to significantly impact operational costs in the upstream and midstream oil and gas sectors[99]. - The SEC's proposed climate-related disclosure rules could affect companies' access to capital, although implementation is currently stayed due to legal challenges[102]. Reserves and Production - The Trust's Royalty Properties consist of approximately 2,092,292 gross acres and 216,551 net acres across six states: Texas, Oklahoma, Louisiana, Mississippi, New Mexico, and Florida[145]. - The largest gross acreage is in Texas with 1,273,132 acres, followed by Oklahoma with 381,538 acres and Louisiana with 244,391 acres[149]. - As of December 31, 2025, the Trust's proved developed producing reserves were evaluated by DeGolyer and MacNaughton, indicating significant potential for future revenue generation[151]. - The estimated future gross revenue from the Trust's proved developed producing reserves is based on current production and market conditions, with a present worth calculated at a 10% discount rate[156]. - The Trust's properties are actively producing in major basins, including the Permian Basin, which has 909,808 gross acres and 43,300 net acres[149]. - The Trust has exposure to various active plays, including the Eagle Ford and Austin Chalk in the Texas Gulf Coast and the Woodford formation in the Anadarko Basin[147]. - The Trust's reserves are classified as proved developed producing, which are expected to be economically recoverable under existing conditions[159]. - The reserve estimates are subject to uncertainties and may change as further production history and additional information become available[157]. - The Trust's royalty interests account for 100% of revenues attributed to royalty interest payments as of December 31, 2025[154]. - The Trust's internal policies for estimating reserves comply with SEC definitions and guidance, ensuring accuracy in reporting[152]. - As of December 31, 2025, the estimated net proved developed producing reserves are 6,631 Mbbl of oil and condensate, 2,692 Mbbl of NGL, and 60,658 MMcf of gas[188]. - The estimated future gross revenue from the production and sale of these reserves is $694,055,000, with future net revenue projected at $611,199,000[188]. - The present worth of estimated future net revenue at a 10% discount rate is $301,151,000, an increase from $280,325,131 at December 31, 2024[196]. - The average price for oil and condensate is estimated at $65.09 per barrel, while NGL is estimated at $24.84 per barrel[180]. - The average price for gas is estimated at $3.225 per thousand cubic feet[181]. - Approximately 44% of total net reserves were summarized by state or area due to the small volumes attributable to many individual royalty interests[179]. - The Trust holds several thousand individual royalty interests, with reserves evaluated based on historical production data and general knowledge of producing characteristics[179]. - Production taxes are estimated at $38,400,000, and ad valorem taxes at $24,671,000[188]. Operational Risks - Cybersecurity threats pose risks to the Trust's operations, and robust protocols are in place to manage these risks[140]. - Public health concerns, such as pandemics, could adversely affect demand for oil and gas, impacting Trust distributions[136]. - The Trust may cease to receive distributions if the Royalty Properties do not generate at least $2,000,000 in net revenue per year over any consecutive two-year period[129]. - The market price of the Trust's Units may not reflect the actual value of the royalty interests, as it is influenced by cash distribution levels and external factors[121]. - The Trust's assets are depleting, and if operators do not perform additional development projects, depletion may occur faster than expected[116]. - Government policies aimed at reducing oil and gas production could adversely impact the Trust's royalty income and market prices[123].

Core Viewpoint - Argent Trust Company, as Trustee of the Sabine Royalty Trust, announced a cash distribution of $0.283370 per unit, payable on February 27, 2026, to unit holders of record on February 17, 2026 [1] Distribution Details - The distribution is based on oil production for November 2025 and gas production for October 2025, with preliminary production volumes of approximately 45,316 barrels of oil and 1,026,714 Mcf of gas [2] - The average prices for this month's distribution are approximately $59.01 per barrel of oil and $2.27 per Mcf of gas [2] - This month's distribution is lower than the previous month due to decreased oil and natural gas production and lower pricing [2] Production and Pricing Comparison - Current month production and pricing compared to the prior month: - Oil: 45,316 barrels (down from 56,504 barrels) - Gas: 1,026,714 Mcf (down from 1,314,850 Mcf) - Oil price: $59.01 per barrel (down from $61.05) - Gas price: $2.27 per Mcf (down from $2.31) [3] Revenue Posting - Approximately $166,000 of revenue received in January will be posted in February, in addition to normal cash receipts for February [4] - Since the end of January, approximately $476,000 in revenue has been received [4] Tax Deductions - Approximately $17,000 for 2025 Ad Valorem taxes were deducted from this month's distribution, compared to $115,000 during the same period last year [5]

Cash Distribution - The Registrant announced a monthly cash distribution to unitholders of record on January 15, 2026[6] - The press release regarding the cash distribution was issued on January 5, 2026[6] - The cash distribution details are included in Exhibit 99.1 attached to the report[8]

Group 1 - The article discusses the analysis of oil and gas companies, focusing on identifying undervalued entities within the sector, including Sabine Royalty Trust [1] - Sabine Royalty Trust is characterized as a passive entity that passes through taxes to investors, presenting both advantages and challenges [2] - The oil and gas industry is described as cyclical, requiring patience and experience for successful investment [2] Group 2 - The investing group, Oil & Gas Value Research, seeks under-followed oil companies and out-of-favor midstream companies that present compelling investment opportunities [2] - The group facilitates discussions among oil and gas investors through an active chat room, allowing for the sharing of recent information and ideas [2]

Core Viewpoint - The share price of Sabine Royalty Trust (NYSE:SBR) has experienced a significant decline due to a substantial cut in its monthly dividend, marking a challenging period for the company in the energy sector [1][2][3]. Group 1: Dividend and Production Changes - Sabine Royalty Trust announced a monthly dividend of $0.19667 per share, which is a decrease of nearly 45% from the previous month's distribution of $0.3567 [3]. - The company reported preliminary production volumes of approximately 28,904 barrels of oil in September, a significant drop from 65,727 barrels in the prior month [3]. - Natural gas production also decreased, coming in at 796,698 Mcf compared to 1,135,345 Mcf previously [3]. Group 2: Historical Context and Market Reaction - This marks the fourth consecutive cut in monthly distributions by Sabine Royalty Trust, resulting in the lowest dividend since 2021 [4]. - Despite the recent slump, the company has gained over 10% in share price so far this year [5].

Core Viewpoint - Monthly dividends are preferred over quarterly payouts due to more frequent cash flow and often higher annual yields, with examples yielding between 8% and 19.8% [2] Group 1: Monthly Dividend Stocks - Monthly dividend stocks can provide substantial annual income, with potential earnings ranging from $40,000 to $99,000 on a $500,000 investment [2] - The article discusses four specific monthly dividend payers, highlighting their unique characteristics and performance [2] Group 2: Sabine Royalty Trust (SBR) - Sabine Royalty Trust is a passive income vehicle that pays distributions from income generated by natural resources, primarily from the Permian Basin [3] - The trust has no debt and has outperformed the broader energy sector, but it is sensitive to commodity prices and has variable distributions [4][7] - SBR's asset base is fixed, and it may terminate if gross revenues fall below $2 million for two consecutive years or if unitholders vote for closure [6] Group 3: Capital Southwest Corp. (CSWC) - Capital Southwest Corp. is a business development company that provides capital to lower middle market firms, with a portfolio of 122 firms [8] - The company has a high percentage of floating-rate debt, which can be advantageous in rising rate environments, and it has outperformed its peers and the S&P 500 [10] - CSWC's dividends are well-covered, and it pays monthly, with a portion of the yield coming from supplemental dividends [10] Group 4: PennantPark Floating Rate Capital (PFLT) - PennantPark Floating Rate Capital targets midsized companies and invests primarily through first-lien floating-rate debt [12][14] - The company has faced tight dividend coverage, with the possibility of a dividend reduction, but management is optimistic about growth through joint ventures [14] Group 5: Orchid Island Capital (ORC) - Orchid Island Capital is a mortgage REIT that deals in agency residential mortgage-backed securities, currently offering a yield close to 20% [16] - The company has experienced significant price declines since its IPO, leading to a reverse stock split, and has a history of reducing dividends [18][19]

Group 1 - The article provides a market analysis covering several companies including Capital Southwest Corporation, Orchid Island Capital Inc, Sabine Royalty Trust, and PennantPark Floating Rate Capital Ltd [1] Group 2 - The analysis highlights the investment opportunities and risks associated with the mentioned companies, indicating a focus on their financial performance and market positioning [1]

Group 1: AI Investment Opportunity - Artificial intelligence is considered the greatest investment opportunity of our lifetime, with a strong emphasis on the urgency to invest now [1] - Wall Street is investing hundreds of billions into AI, but there is a critical question regarding the energy supply needed to support this technology [2] - AI data centers consume as much energy as small cities, leading to concerns about power grid strain and rising electricity prices [2] Group 2: Company Overview - A specific company is highlighted as a key player in the AI energy sector, owning critical energy infrastructure assets that are essential for meeting the increasing energy demands of AI [3][6] - This company is not a chipmaker or cloud platform but is positioned to benefit significantly from the upcoming AI energy spike [3] - It is involved in U.S. LNG exportation and is expected to thrive under the "America First" energy doctrine [7] Group 3: Financial Position - The company is completely debt-free and has a cash reserve equal to nearly one-third of its market cap, making it financially robust compared to other energy firms [8] - It trades at less than 7 times earnings, indicating it is undervalued relative to its potential [10] Group 4: Market Trends - The company is poised to benefit from the AI infrastructure supercycle, the onshoring boom due to tariffs, and a surge in U.S. LNG exports [14] - The influx of talent into the AI sector is expected to drive rapid advancements and innovation, further solidifying the importance of investing in AI [12] Group 5: Investment Potential - The company is described as a "toll booth" operator in the AI energy boom, collecting fees on energy exports and benefiting from the growing demand for electricity [5][6] - There is a potential for significant returns, with projections suggesting a 100+% return within 12 to 24 months [15]

[FORM 8-K Filing Information](index=1&type=section&id=FORM%208-K%20Filing%20Information) This section details the administrative information for the Form 8-K filing, including registrant identification and exchange listing [Registrant Details and Exchange Listing](index=1&type=section&id=Registrant%20Details%20and%20Exchange%20Listing) This section details the registrant's legal name, contact information, and New York Stock Exchange listing under SBR - Registrant Name: **SABINE ROYALTY TRUST**[2](index=2&type=chunk) Securities Registered | Title of each class | Symbol(s) | Name of each exchange on which registered | | :----------------------- | :-------- | :---------------------------------------- | | Units of Beneficial Interest | SBR | New York Stock Exchange | [Current Report Items](index=2&type=section&id=Current%20Report%20Items) This section outlines key reported events, including financial condition updates and accompanying exhibits [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) SABINE ROYALTY TRUST announced a monthly cash distribution to unitholders, furnished under Section 18 of the Securities Exchange Act - A press release on **October 3, 2025**, announced the monthly cash distribution to unitholders of record on **October 15, 2025**[6](index=6&type=chunk) - The furnished information is not considered 'filed' under Section 18 of the Securities Exchange Act of 1934, thus avoiding associated liabilities[7](index=7&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This item lists the Form 8-K exhibits, identifying the October 3, 2025 press release as Exhibit 99.1 - **Exhibit 99.1**: Press Release dated **October 3, 2025**[8](index=8&type=chunk) [SIGNATURES](index=3&type=section&id=SIGNATURES) This section confirms the official signing of the report by the authorized trustee representative [Signature Details](index=3&type=section&id=Signature%20Details) The report was signed by Argent Trust Company, Trustee for SABINE ROYALTY TRUST, on October 3, 2025 - The report was signed by **Argent Trust Company**, Trustee, on behalf of **SABINE ROYALTY TRUST**[11](index=11&type=chunk) - Signatory: **Nancy Willis**, Director of Royalty Trust Services[11](index=11&type=chunk) - Date of signature: **October 3, 2025**[11](index=11&type=chunk)