NRP's Q3 Earnings Plunge Amidst Royalty, Equity Income Declines

TL;DR

**NRP's Q3 numbers are a red flag; revenue and net income are down significantly, making that debt reduction look like a necessary move, not a growth driver.**

AI Summary

Natural Resource Partners LP (NRP) reported a significant decline in net income and total revenues for the nine months ended September 30, 2025, compared to the same period in 2024. Net income decreased by 25.2% to $105.37 million from $140.87 million, while total revenues and other income fell by 20.6% to $160.57 million from $202.28 million. This decline was primarily driven by a 15.8% decrease in royalty and other mineral rights revenue, which dropped to $145.17 million from $172.37 million, and a substantial 72.4% reduction in equity in earnings of Sisecam Wyoming, from $17.20 million to $4.75 million. Despite these revenue challenges, the company managed to reduce its long-term debt by 56.9% to $55.13 million from $127.88 million as of December 31, 2024. Cash provided by operating activities also saw a sharp decrease of 33.5%, falling to $121.10 million from $182.27 million. Basic net income per common unit decreased to $7.87 from $8.47, a 7.1% reduction. The company also completed the redemption of all preferred units and settlement of all warrants in 2024, simplifying its capital structure.

Why It Matters

NRP's substantial decline in revenue and net income, particularly from its core mineral rights and Sisecam Wyoming investment, signals a challenging environment for the company and its investors. The 25.2% drop in net income could impact future distribution stability, a key draw for MLP investors. While the significant reduction in long-term debt is a positive for financial health, the underlying operational weakness in revenue generation, especially in coal royalties, raises concerns about long-term growth and competitive positioning in a shifting energy landscape. Employees might face pressure if these trends continue, and customers could see pricing adjustments or changes in service offerings as NRP adapts.

Risk Assessment

Risk Level: high — The risk level is high due to a 25.2% decrease in net income to $105.37 million and a 20.6% drop in total revenues to $160.57 million for the nine months ended September 30, 2025. Furthermore, cash provided by operating activities decreased by 33.5% to $121.10 million, indicating significant operational headwinds.

Analyst Insight

Investors should carefully evaluate NRP's ability to generate sustainable revenue and cash flow given the significant declines in its core segments. Consider reducing exposure or holding off on new investments until there's clear evidence of revenue stabilization or growth, despite the positive debt reduction.

Financial Highlights

debt To Equity

0.09

revenue

$160.57M

operating Margin

70%

total Assets

$753.55M

total Debt

$69.38M

net Income

$105.37M

eps

$7.87

gross Margin

N/A

cash Position

$31.02M

revenue Growth

-20.6%

Revenue Breakdown

Key Numbers

• $105.37M — Net Income (Decreased by 25.2% for the nine months ended September 30, 2025, from $140.87 million in 2024.)
• $160.57M — Total Revenues and Other Income (Decreased by 20.6% for the nine months ended September 30, 2025, from $202.28 million in 2024.)
• $145.17M — Royalty and Other Mineral Rights Revenue (Decreased by 15.8% for the nine months ended September 30, 2025, from $172.37 million in 2024.)
• $4.75M — Equity in Earnings of Sisecam Wyoming (Decreased by 72.4% for the nine months ended September 30, 2025, from $17.20 million in 2024.)
• $55.13M — Long-term Debt, net (Decreased by 56.9% as of September 30, 2025, from $127.88 million at December 31, 2024.)
• $121.10M — Net Cash Provided by Operating Activities (Decreased by 33.5% for the nine months ended September 30, 2025, from $182.27 million in 2024.)
• $7.87 — Basic Net Income Per Common Unit (Decreased by 7.1% for the nine months ended September 30, 2025, from $8.47 in 2024.)
• 13,138,097 — Common Units Outstanding (As of September 30, 2025, an increase from 13,049,123 units at December 31, 2024.)

Key Players & Entities

• NATURAL RESOURCE PARTNERS LP (company) — Registrant
• NRP (company) — Ticker symbol
• Sisecam Wyoming LLC (company) — Unconsolidated investment
• New York Stock Exchange (regulator) — Exchange where NRP common units are registered
• GP Natural Resource Partners LLC (company) — General Partner of NRP
• FASB (regulator) — Issued ASU 2024-03
• SEC (regulator) — Filed 10-K with SEC
• NRP (Operating) LLC (company) — Wholly owned operating company

FAQ

Risk Factors

• Commodity Price Volatility [high — market]: The Partnership's revenues are significantly tied to the prices of coal, soda ash, and other commodities. Fluctuations in these prices, driven by global supply and demand, geopolitical events, and economic conditions, can materially impact the Partnership's financial performance and profitability. For instance, the decrease in equity in earnings of Sisecam Wyoming was partly due to lower soda ash prices.
• Decreased Demand for Coal [high — market]: The long-term trend of declining demand for coal, driven by environmental regulations and the shift towards renewable energy sources, poses a significant risk to the Partnership's coal royalty revenues. Coal royalty revenues decreased by 18.4% for the nine months ended September 30, 2025, compared to the prior year.
• Environmental Regulations [medium — regulatory]: Increasingly stringent environmental regulations related to mining, emissions, and climate change could lead to higher operating costs, require significant capital expenditures for compliance, or restrict mining activities. This could negatively affect the Partnership's ability to generate revenue from its mineral rights.
• Operational Risks at Sisecam Wyoming [medium — operational]: The Partnership's significant investment in Sisecam Wyoming exposes it to operational risks at that facility, including production disruptions, safety incidents, or equipment failures. Such events could lead to reduced earnings from this investment, as seen with the 72.4% decrease in equity in earnings for the nine months ended September 30, 2025.
• Interest Rate Sensitivity [low — financial]: While long-term debt has been significantly reduced, the Partnership is still exposed to interest rate fluctuations. Changes in interest rates can affect the cost of any future borrowings and the valuation of its debt. Interest expense, net decreased by 43.3% for the nine months ended September 30, 2025, indicating a reduction in debt burden.
• Contractual Obligations and Disputes [low — legal]: The Partnership is party to various contracts, including leases and royalty agreements. Disputes over contract terms, royalty calculations, or lease obligations could lead to litigation and financial liabilities. The Partnership has $55,439,000 in non-cancellable annual minimum payments due under lease terms as of September 30, 2025.

Industry Context

Natural Resource Partners LP operates in the diversified natural resources sector, primarily focusing on owning, managing, and leasing mineral properties. The industry is characterized by its cyclical nature, sensitivity to commodity prices (coal, soda ash, oil, gas), and increasing regulatory scrutiny regarding environmental impact. Key trends include a long-term decline in coal demand due to energy transition initiatives and a growing focus on sustainability, impacting traditional resource extraction businesses.

Regulatory Implications

The Partnership faces ongoing regulatory risks related to environmental protection, mine safety, and emissions standards. Compliance with these regulations can increase operating costs and capital expenditures. Changes in environmental policies, particularly those related to climate change and carbon emissions, could materially affect the demand for and profitability of its core mineral assets, especially coal.

What Investors Should Do

1. Monitor commodity price trends, particularly for coal and soda ash.
2. Analyze the sustainability of the reduced debt levels.
3. Evaluate the impact of the energy transition on coal-related revenues.
4. Assess the performance and outlook of the Sisecam Wyoming investment.

Key Dates

• 2024-09-30: Redemption of preferred units and settlement of warrants — Simplified the capital structure by eliminating preferred units and warrants, reducing future dividend/interest obligations and potential dilution.
• 2025-09-30: End of Nine Months Reporting Period — Period for which the financial results discussed in the 10-Q are reported, showing a decline in revenue and net income but a significant reduction in debt.
• 2024-12-31: Year-End 2024 — Baseline for comparison of year-end balance sheet items, notably the higher long-term debt of $127.88M compared to $55.13M as of September 30, 2025.

Glossary

Equity in earnings of Sisecam Wyoming

The portion of the net income of Sisecam Wyoming LLC that is attributable to Natural Resource Partners LP's ownership stake (49%). (This is a significant component of NRP's non-royalty income, and its decline directly impacted overall revenue and net income.)

Royalty and other mineral rights revenue

Income generated from leasing mineral rights to third parties, typically based on production volumes or a fixed minimum payment. (This is the primary revenue stream for NRP, and its decrease is a key driver of the overall revenue decline.)

Deferred revenue

Revenue that has been received by the company but not yet earned, often related to minimum lease payments that are recognized over the life of the lease. (Changes in deferred revenue can impact the timing of revenue recognition and provide insight into future revenue expectations.)

Common units outstanding

The total number of common units of the partnership that are currently held by investors. (An increase in common units outstanding can lead to dilution of earnings per unit if not accompanied by a proportional increase in net income.)

Net cash provided by operating activities

The amount of cash generated from the normal day-to-day business operations of the company. (A key indicator of the company's ability to generate cash flow from its core business, which is essential for debt repayment, investments, and distributions.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, Natural Resource Partners LP has experienced a significant downturn, with total revenues and other income decreasing by 20.6% to $160.57 million and net income falling by 25.2% to $105.37 million. This decline is largely attributed to a 15.8% drop in royalty and other mineral rights revenue and a severe 72.4% reduction in equity in earnings from Sisecam Wyoming. Despite these revenue challenges, the company has made substantial progress in deleveraging, reducing its long-term debt by 56.9% to $55.13 million. However, operating cash flows have also contracted by 33.5%, indicating pressure on the core business's cash generation.

Key Financial Figures

• $2.15 million — ) $ 517,193 (1) Net income includes $2.15 million of income attributable to preferred uni
• $2.11 million — accumulated during the period, of which $2.11 million is allocated to the common unitholders
• $0.04 million — allocated to the common unitholders and $0.04 million is allocated to the general partner. (
• $1.44 million — eral partner. (2) Net income includes $1.44 million of income attributable to preferred uni
• $1.41 million — accumulated during the period, of which $1.41 million is allocated to the common unitholders
• $0.03 million — allocated to the common unitholders and $0.03 million is allocated to the general partner.
• $0.66 million — ral partner. (3) Net income includes $0.66 million of income attributable to preferred uni
• $0.64 million — accumulated during the period, of which $0.64 million is allocated to the common unitholders
• $0.01 million — allocated to the common unitholders and $0.01 million is allocated to the general partner.

Filing Documents

• nrp20250930_10q.htm (10-Q) — 1997KB
• ex_854767.htm (EX-31.1) — 13KB
• ex_854768.htm (EX-31.2) — 12KB
• ex_854769.htm (EX-32.1) — 5KB
• ex_854770.htm (EX-32.2) — 5KB
• logo.jpg (GRAPHIC) — 4KB
• 0001437749-25-032941.txt ( ) — 8168KB
• nrp-20250930.xsd (EX-101.SCH) — 68KB
• nrp-20250930_cal.xml (EX-101.CAL) — 36KB
• nrp-20250930_def.xml (EX-101.DEF) — 410KB
• nrp-20250930_lab.xml (EX-101.LAB) — 346KB
• nrp-20250930_pre.xml (EX-101.PRE) — 443KB
• nrp20250930_10q_htm.xml (XML) — 1579KB

Financial Information

Part I. Financial Information Item 1. Consolidated Financial Statements Consolidated Balance Sheets 1 Consolidated Statements of Comprehensive Income 2 Consolidated Statements of Partners ' Capital 3 Consolidated Statements of Cash Flows 5

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 6 Item 2. Management ' s Discussion and Analysis of Financial Condition and Results of Operations 18 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 31 Item 4.

Controls and Procedures

Controls and Procedures 31

Other Information

Part II. Other Information Item 1.

Legal Proceedings

Legal Proceedings 32 Item 1A.

Risk Factors

Risk Factors 32 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 32 Item 3. Defaults Upon Senior Securities 32 Item 4. Mine Safety Disclosures 32 Item 5. Other Information 32 Item 6. Exhibits 32

Signatures

Signatures 33 i Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS NATURAL RESOURCE PARTNERS L.P. CONSOLIDATED BALANCE SHEETS September 30, December 31, 2025 2024 (In thousands, except unit data) (Unaudited) ASSETS Current assets Cash and cash equivalents $ 31,019 $ 30,444 Accounts receivable, net 30,442 31,469 Other current assets, net 455 1,961 Total current assets $ 61,916 $ 63,874 Land 24,008 24,008 Mineral rights, net 369,902 379,638 Intangible assets, net 12,332 12,924 Equity in unconsolidated investment 253,717 257,355 Long-term contract receivable, net 21,197 23,480 Other long-term assets, net 10,482 11,628 Total assets $ 753,554 $ 772,907 LIABILITIES AND CAPITAL Current liabilities Accounts payable $ 886 $ 909 Accrued liabilities 8,313 12,121 Accrued interest 492 302 Current portion of deferred revenue 5,005 4,341 Current portion of long-term debt, net 14,246 14,192 Total current liabilities $ 28,942 $ 31,865 Deferred revenue 52,514 55,814 Long-term debt, net 55,131 127,876 Other non-current liabilities 5,717 6,244 Total liabilities $ 142,304 $ 221,799 Commitments and contingencies (see Note 13) Partners' capital Common unitholders' interest ( 13,138,097 and 13,049,123 units issued and outstanding at September 30, 2025 and December 31, 2024, respectively) $ 602,552 $ 543,231 General partner's interest 10,913 9,547 Accumulated other comprehensive loss ( 2,215 ) ( 1,670 ) Total partners' capital $ 611,250 $ 551,108 Total liabilities and partners' capital $ 753,554 $ 772,907 The accompanying notes are an integral part of these consolidated financial statements. 1 Table of Contents NATURAL RESOURCE PARTNERS L.P. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) For the Three Months Ended September 30, For the Nine Months Ended September 30, (In thousands, except per unit data) 2025 2024 2025 2024 Revenues and other income Royalty and other mineral right

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Basis of Presentation Nature of Business Natural Resource Partners L.P. (the "Partnership") engages principally in the business of owning, managing and leasing a diversified portfolio of mineral properties in the United States, including interests in coal and other natural resources and owns a non-controlling 49 % interest in Sisecam Wyoming LLC ("Sisecam Wyoming"), a trona ore mining and soda ash production business. The Partnership is organized into two operating segments further described in Note 6. Segment Information . The Partnership's operations are conducted through, and its operating assets are owned by, its subsidiaries. The Partnership owns its subsidiaries through one wholly owned operating company, NRP (Operating) LLC ("Opco"). As used in these Notes to Consolidated Financial Statements, the terms "NRP," "we," "us" and "our" refer to Natural Resource Partners L.P. and its subsidiaries, unless otherwise stated or indicated by context. Principles of Consolidation and Reporting The accompanying unaudited Consolidated Financial Statements of the Partnership have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") for interim financial information and with Rule 10 - 01 of Regulation S- X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2024 and notes thereto included in the Partnership's Annual Report on Form 10 -K, which was filed with the SEC on February 28, 2025. Reclassifications have been made to prior year amounts in the Consolidated Financial Statements to conform with current year presentation. These reclassifications had no impact on previously reported total assets, total liabilities, partners' capital, net income, or cash flows

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED (Unaudited) 2. Revenues from Contracts with Customers The following table presents the Partnership's Mineral Rights segment revenues from contracts with customers by major source: For the Three Months Ended September 30, For the Nine Months Ended September 30, (In thousands) 2025 2024 2025 2024 Coal royalty revenues $ 34,193 $ 37,605 $ 101,234 $ 124,108 Production lease minimum revenues 1,365 437 4,213 1,773 Minimum lease straight-line revenues 4,176 4,117 12,276 12,414 Oil and gas royalty revenues 1,787 1,317 6,212 6,956 Carbon neutral revenues 316 ( 39 ) 1,201 4,322 Property tax revenues 2,105 1,809 5,261 5,246 Wheelage revenues 2,225 2,072 6,506 7,082 Coal overriding royalty revenues 297 227 1,633 2,064 Lease amendment revenues 1,699 1,071 3,010 2,485 Aggregates royalty revenues 1,011 662 2,770 2,164 Other revenues 441 1,127 854 1,956 Royalty and other mineral rights revenues $ 49,615 $ 50,405 $ 145,170 $ 170,570 Transportation and processing services revenues 1,293 1,248 7,207 6,169 Total Mineral Rights segment revenues from contracts with customers $ 50,908 $ 51,653 $ 152,377 $ 176,739 The following table details the Partnership's Mineral Rights segment contract assets and liabilities resulting from contracts with customers: September 30, December 31, (In thousands) 2025 2024 Contract assets Accounts receivable, net $ 26,222 $ 27,358 Other current assets, net 212 — Other long-term assets, net 1,957 2,352 Contract liabilities Accounts payable $ 125 $ 125 Current portion of deferred revenue 5,005 4,341 Deferred revenue 52,514 55,814 The following table shows the activity related to the Partnership's Mineral Rights segment deferred revenue resulting from contracts with customers: For the Nine Months Ended September 30, (In thousands) 2025 2024 Balance at beginning of period (current and non-current) $ 60,155 $

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED (Unaudited) 3. Class A Convertible Preferred Units and Warrants During the three months ended September 30, 2024, the Partnership redeemed 31,666 Class A Convertible Preferred Units (the "preferred units") for $ 31.7 million in cash. During the nine months ended September 30, 2024, the Partnership redeemed a total of 71,666 preferred units for $ 71.7 million in cash. In 2024, all remaining preferred units were redeemed and none of the Partnership's preferred units remained outstanding as of September 30, 2025 and December 31, 2024 . During the nine months ended September 30, 2024, the Partnership settled a total of 1,540,000 warrants to purchase common units ("warrants") with a strike price of $ 34.00 . These warrants were settled on a net basis for a total of $ 65.7 million in cash and 287,826 common units. In 2024, all remaining warrants were settled and none of the Partnership's warrants remained outstanding as of September 30, 2025 and December 31, 2024 . 4. Common and Preferred Unit Distributions The Partnership makes cash distributions to common unitholders and made cash distributions to preferred unitholders on a quarterly basis, subject to approval by the Board of Directors of GP Natural Resource Partners LLC (the "Board of Directors"). NRP recognizes common unit distributions on the date the distribution is declared. In 2024, the Partnership recognized preferred unit distributions on the date the distribution was declared. Distributions made on the common units and the general partner's general partner ("GP") interest are made on a pro-rata basis in accordance with their relative percentage interests in the Partnership. The general partner is entitled to receive 2 % of such distributions. Income available to common unitholders and the general partner was reduced by $ 0.7 million and $ 4.2 million in preferred unit distributions that accumulated during the three and nine months ended September

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED (Unaudited) 5. Net Income Per Common Unit In 2025, basic net income per common unit is computed by dividing net income, after considering the general partner's general partner interest, by the weighted average number of common units outstanding. Diluted net income per common unit includes the effect of NRP's unvested unit-based awards if the inclusion of these items is dilutive. In 2024, basic net income per common unit is computed by dividing net income, after considering income attributable to preferred unitholders, the difference between the fair value of the consideration paid upon redemption and the carrying value of the preferred units, and the general partner's general partner interest, by the weighted average number of common units outstanding. Diluted net income per common unit includes the effect of NRP's preferred units, warrants, and unvested unit-based awards if the inclusion of these items is dilutive. The dilutive effect of the preferred units in 2024 was calculated using the if-converted method. Under the if-converted method, the preferred units were assumed to be converted at the beginning of the period, and the resulting common units were included in the denominator of the diluted net income per unit calculation for the period being presented. Distributions declared in the period and undeclared distributions on the preferred units that accumulated during the period were added back to the numerator for purposes of the if-converted calculation. The calculation of diluted net income for the three months ended September 30, 2024 did not include the assumed conversion of any remaining preferred units as all preferred units were redeemed as of September 30, 2024. The calculation of diluted net income per common unit for the nine months ended September 30, 2024 included the assumed conversion of the remaining preferred units during the period. The calculation of diluted net income for the three an

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED (Unaudited) 6. Segment Information The Partnership's segments are strategic business units that offer distinct products and services to different customers in different geographies within the U.S. and that are managed accordingly. NRP has the following two operating segments: Mineral Rights —consists of mineral interests and other subsurface rights across the United States. NRP's ownership provides critical inputs for the manufacturing of steel, electricity, and basic building materials, as well as opportunities for carbon sequestration and renewable energy. Soda Ash —consists of the Partnership's 49 % non-controlling equity interest in Sisecam Wyoming, one of the world's lowest-cost producers of soda ash, an essential ingredient for the manufacturing of glass, detergents, solar panels, and batteries for electric vehicles. Operations are managed by NRP's partner, Sisecam Chemicals Wyoming, LLC, and NRP realizes cash flow when distributions are paid to it. Direct segment costs and certain other costs incurred at

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