Core Viewpoint - Natural Resource Partners L.P. (NRP) has faced significant challenges in the fourth quarter of 2024, with declining revenues and earnings primarily due to weaker coal and soda ash pricing, although the company remains focused on deleveraging and maintaining free cash flow generation [2][3][17]. Financial Performance - NRP reported diluted earnings per share of $3.15 for Q4 2024, a 27% decrease from $4.31 in the prior-year quarter [2]. - Revenues for Q4 2024 were $65.7 million, down 29.5% from $93.2 million in Q4 2023 [2]. - Full-year revenues declined 27.5% year over year to $268 million from $370 million [2]. - Net income for Q4 2024 was $42.8 million, a 34.2% decrease from $65 million in the prior-year period [3]. - Operating cash flow for Q4 2024 was $66.2 million, down from $77.8 million in the prior-year quarter [3]. - Free cash flow also declined to $66.9 million in Q4 from $78.4 million in the year-ago quarter [3]. Segment Performance - The Mineral Rights segment saw a 17% decline in net income to $52.4 million from $63.1 million a year ago [4]. - The Soda Ash segment's net income plummeted 94.1% to $0.9 million from $14.7 million in the prior-year quarter, with full-year net income down 75.4% to $18 million from $73.1 million [7]. Cash Distributions and Shareholder Returns - NRP distributed $5.44 per common unit in 2024, including regular quarterly distributions of 75 cents per unit and a special distribution of $2.44 per unit [15]. - In February 2025, the company declared a fourth-quarter distribution of 75 cents per unit, alongside a special distribution of $1.21 per unit [15]. Management Strategy - The company has reduced over $1.3 billion in financial obligations over the past decade, leaving only $142 million of debt as of the end of 2024 [9]. - NRP increased its credit facility by $45 million to $200 million and extended its maturity to 2029 [10]. - Management expects continued price pressures in 2025 but remains confident in generating significant free cash flow as debt obligations decline [13]. Market Outlook - Management acknowledged weak metallurgical and thermal coal prices, which are unlikely to rebound soon due to soft global steel demand and high coal inventory levels [11]. - Soda ash pricing is expected to remain subdued due to excess supply, but NRP's low-cost positioning in Sisecam Wyoming provides some resilience [12]. - The company is pursuing carbon-neutral initiatives, although the market for carbon sequestration has been slower to develop than anticipated [14].
NRP Q4 Earnings Drop Y/Y Amid Weak Coal, Soda Ash Prices