Mesabi Trust(MSB) - 2026 Q2 - Quarterly Report

Financial Performance - Royalty income for the three months ended July 31, 2025, was $5,416,904, a decrease of 13.4% from $6,254,719 in the same period of 2024[14] - Total revenues for the six months ended July 31, 2025, were $10,341,297, down 18.8% from $12,740,480 in 2024[14] - Net income for the three months ended July 31, 2025, was $4,743,882, a decline of 12.1% compared to $5,397,894 in 2024[14] - Net income for the six months ended July 31, 2025, was $8,375,091, a decrease of $506,587 compared to the same period in 2024[75] - Total royalty income decreased to $9,766,376 for the six months ended July 31, 2025, down from $12,265,326 in 2024, representing a decline of 20.4%[77] - Total revenues for the six months ended July 31, 2025, were $10,341,297, a decrease of 18.9% from $12,740,480 in 2024[77] - The Trust's net income per unit decreased by $0.0498 to $0.3616 for the fiscal quarter ended July 31, 2025[77] Cash and Assets - Cash and cash equivalents decreased significantly to $21,249,191 as of July 31, 2025, from $100,204,531 at the beginning of the period[17] - The Trust's total assets decreased to $24,776,662 as of July 31, 2025, from $101,728,455 on January 31, 2025[17] - The unallocated cash and cash equivalents as of July 31, 2025, amounted to $19,674,790, down from $22,140,471 as of January 31, 2025[43] - Accrued Income Receivable decreased by 44.1% to $1,443,875 as of July 31, 2025, compared to $2,584,690 in 2024[80] Liabilities and Distributions - Total liabilities dropped to $1,995,459 as of July 31, 2025, from $78,400,735 on January 31, 2025[17] - Distributions declared per unit for the six months ended July 31, 2025, were $0.6800, an increase from $0.5900 in 2024[14] - The Trust declared a distribution of $0.12 per Unit of Beneficial Interest on July 11, 2025, totaling $1,574,401, compared to $0.30 per Unit for the same quarter in 2024[42] Royalty Income and Production - Royalties received for the six months ended July 31, 2025, were $7,727,463, down 25.5% from $10,385,169 in 2024[19] - For the three months ended July 31, 2025, Northshore's production and shipments of iron ore pellets totaled 943,955 tons, a decrease from 974,532 tons in the same period of 2024[64] - The decrease in total royalty income for the three months ended July 31, 2025 is attributed to lower pricing and shipments of iron ore[67] - Base overriding royalties decreased by $348,039 to $3,216,028, while bonus royalties decreased by $528,224 to $2,018,440 for the three months ended July 31, 2025[68] Legal and Regulatory Matters - The Minnesota Supreme Court denied petitions for review regarding the Milepost 7 tailings basin project, impacting future mining and royalties[91] - WaterLegacy filed a motion for a temporary injunction against DNR and Northshore, which was denied by the court on September 4, 2025[94] - The Trustees cannot predict the impact of the WaterLegacy lawsuit on Northshore's mining, production, and shipments of iron ore products[95] Accounting and Compliance - The Trust's financial statements are prepared on an accrual basis, with distributions declared based on actual royalty payments received rather than recorded income[40] - The Trust is not taxable as a corporation, with all net taxable income attributed directly to Unitholders for tax purposes[111] - There have been no material changes in the Trust's critical accounting policies during the three months ended July 31, 2025[110] - The report includes certifications pursuant to the Sarbanes-Oxley Act of 2002, ensuring compliance with financial reporting standards[129] - Boulay PLLP conducted a review of the unaudited interim financial statements of Mesabi Trust for the three and six months ended July 31, 2025[129]