Financial Performance - Royalty income for Q1 2024 was $183,657, a significant decrease from $845,417 in Q1 2023, primarily due to lower pricing and net production of natural gas, natural gas liquids, and oil [67]. - Distributable income for Q1 2024 was $122,029, translating to $0.0655 per unit, compared to $724,430 or $0.3887 per unit in Q1 2023 [67]. - Average sales price for natural gas was $2.16 per Mcf in Q1 2024, down from $21.87 per Mcf in Q1 2023, while oil and condensate prices were $67.01 per Bbl in Q1 2024 compared to $73.15 per Bbl in Q1 2023 [64]. - Monthly distributions per unit for January 2024 were $0.0252, February $0.0087, and March $0.0278, totaling $0.0617 for Q1 2024, compared to $0.3697 for Q1 2023 [77]. Income and Expenses - The Trust's interest income increased to $24,228 in Q1 2024 from $20,087 in Q1 2023, reflecting a 10.65% growth [71]. - General and administrative expenses decreased to $46,192 in Q1 2024 from $66,074 in Q1 2023, indicating improved cost management [72]. Reserves and Production - The Contingent Reserve increased to $1,762,256 as of March 31, 2024, up from $1,407,705 as of March 31, 2023, with plans to reach $2.0 million [75]. - Natural gas and natural gas liquids production from the Hugoton Royalty Properties accounted for none of the Trust's royalty income in Q1 2024 or 2023 [79]. Market Conditions and Risks - The Trust's royalty income is heavily influenced by commodity prices, which are subject to volatility due to geopolitical risks and market conditions [62]. - High inflation and interest rates, along with supply chain disruptions, are expected to adversely impact royalty income in 2024 [78]. Governance and Compliance - The Trust has not identified any changes in internal control over financial reporting that materially affect its operations during the last fiscal quarter [109]. - There are no pending legal proceedings involving the Trust, although it may be subject to ordinary course litigation related to Royalty Properties [112]. - The Trustee relies on information from Working Interest Owners regarding projected production and reserve information, which may impact future Royalty income [107]. - No officers or employees of the Trustee adopted or modified any Rule 10b5-1 trading arrangements during the three months ended March 31, 2024 [114]. - The Trust's risk factors remain unchanged during the quarter ended March 31, 2024 [113].
Mesa Royalty Trust(MTR) - 2024 Q1 - Quarterly Report