Natural Resource Partners (NRP) Q3 2025 earnings summary

Executive summary

• Generated $42 million of free cash flow in Q3 2025 and $190 million over the last 12 months, despite significant headwinds in metallurgical coal, thermal coal, and soda ash markets.

• Operating cash flow was $121.1 million and free cash flow was $123.2 million for the nine months ended September 30, 2025, with liquidity of $190.1 million and a leverage ratio of 0.4x.

• Revenues and other income declined 21% year-over-year to $160.6 million, driven by lower coal and soda ash prices and volumes.

• Maintains a conservative management approach, focusing on debt reduction and capital preservation amid challenging commodity markets.

• Quarterly distributions of $0.75 per common unit were paid, with a special $1.21 per unit distribution in March 2025.

Financial highlights

• Q3 2025 net income was $31 million, operating cash flow $41 million, and free cash flow $42 million.

• Net income for the nine months ended September 30, 2025 was $105.4 million, down from $140.9 million year-over-year.

• Adjusted EBITDA for the period was $126.9 million, a decrease from $176.6 million in the prior year.

• Mineral rights segment generated $41 million net income, $44 million operating cash flow, and $45 million free cash flow; net income flat year-over-year, but operating and free cash flow down $9 million due to weaker met coal prices.

• Soda ash segment net income decreased $11 million year-over-year, with operating and free cash flow each down $6 million, driven by lower international prices and weak demand.

Outlook and guidance

• Expects to be in a net cash position and able to increase distributions by Q3 2026, barring unforeseen negative events.

• Management anticipates continued weak coal and soda ash prices for the foreseeable future but expects to generate sufficient free cash flow to meet deleveraging goals.

• No expectation for Şişecam Wyoming soda ash distributions to resume until market conditions improve.

• Continues to view North American thermal coal as in long-term secular decline until evidence suggests otherwise.