VOC Energy Trust Files Q2 2024 10-Q

TL;DR

VOC Energy Trust filed its Q2 10-Q on 8/9/24. Check financials.

AI Summary

VOC Energy Trust filed its quarterly report on Form 10-Q for the period ended June 30, 2024. The filing, submitted on August 9, 2024, details the company's financial performance and operational status. VOC Energy Trust is registered in Delaware and its principal executive offices are located in Houston, Texas.

Why It Matters

This filing provides investors with an update on VOC Energy Trust's financial health and operational activities for the second quarter of 2024, crucial for investment decisions.

Risk Assessment

Risk Level: low — This is a routine quarterly filing providing standard financial information, not indicating any immediate or unusual risks.

Key Numbers

• 001-35160 — SEC File Number (Identifier for the company's filings with the SEC)
• 1231 — Fiscal Year End (Indicates the end of the company's fiscal year)

Key Players & Entities

• VOC Energy Trust (company) — Registrant
• June 30, 2024 (date) — Quarterly period end date
• August 9, 2024 (date) — Filing date
• The New York Stock Exchange (company) — Exchange where units are traded
• The Bank of New York Mellon Trust Company, N.A., Trustee (company) — Trustee

FAQ

Key Financial Figures

• $31,215 — $ 0.23 $ 0.37 $ 0.46 (1) Includes $31,215 and $30,014 paid to VOC Brazos Energy P
• $30,014 — .37 $ 0.46 (1) Includes $31,215 and $30,014 paid to VOC Brazos Energy Partners, LP
• $61,229 — ne 30, 2024 and 2023, respectively, and $61,229 and $58,874 during the six months ended
• $58,874 — and 2023, respectively, and $61,229 and $58,874 during the six months ended June 30, 20
• $37,500 — 4 and 2023, respectively. Also includes $37,500 paid to The Bank of New York Mellon Tru
• $75,000 — eriods ended June 30, 2024 and 2023 and $75,000 during each of the six-month periods en
• $1.0 million — interest, VOC Brazos can reserve up to $1.0 million for future development, maintenance or
• $1.175 million — dually build a reserve of approximately $1.175 million for the payment of future known, antici
• $3,230,000 — quarterly distribution during 2024 was $3,230,000, or $0.19 per Trust Unit, and was made
• $0.19 — ribution during 2024 was $3,230,000, or $0.19 per Trust Unit, and was made on Februar
• $3,060,000 — quarterly distribution during 2024 was $3,060,000, or $0.18 per Trust Unit, and was made
• $0.18 — ribution during 2024 was $3,060,000, or $0.18 per Trust Unit, and was made on May 15,
• $3,910,000 — quarterly distribution during 2023 was $3,910,000, or $0.23 per Trust Unit, and was made
• $0.23 — ribution during 2023 was $3,910,000, or $0.23 per Trust Unit, and was made on Februar
• $231,030 — hrough December 31, 2022 and was net of $231,030 withheld by the Trustee towards the bui

Filing Documents

• tm2415199d1_10q.htm (10-Q) — 164KB
• tm2415199d1_ex31.htm (EX-31) — 11KB
• tm2415199d1_ex32.htm (EX-32) — 6KB
• 0001104659-24-087799.txt ( ) — 182KB

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements. VOC ENERGY TRUST (Unaudited) Three months ended June 30, Six months ended June 30, 2024 2023 2024 2023 Income from net profits interest $ 3,377,463 $ 4,222,042 $ 6,981,577 $ 8,550,794 Cash on hand withheld for Trust expenses (196,626 ) (76,177 ) (214,281 ) (119,366 ) General and administrative expenses (1) (120,837 ) (235,865 ) (477,296 ) (611,428 ) Distributable income $ 3,060,000 $ 3,910,000 $ 6,290,000 $ 7,820,000 Distributions per Trust unit (17,000,000 Trust units issued and outstanding at June 30, 2024 and 2023) $ 0.18 $ 0.23 $ 0.37 $ 0.46 (1) Includes $31,215 and $30,014 paid to VOC Brazos Energy Partners, LP (“VOC Brazos”) during the three months ended June 30, 2024 and 2023, respectively, and $61,229 and $58,874 during the six months ended June 30, 2024 and 2023, respectively. Also includes $37,500 paid to The Bank of New York Mellon Trust Company, N.A. during each of the three-month periods ended June 30, 2024 and 2023 and $75,000 during each of the six-month periods ended June 30, 2024 and 2023. June 30, 2024 December 31, 2023 (Unaudited) ASSETS Cash and cash equivalents $ 1,643,582 $ 1,429,301 Investment in net profits interest 140,591,606 140,591,606 Accumulated amortization and impairment (129,548,020 ) (128,648,342 ) Total assets $ 12,687,168 $ 13,372,565 TRUST CORPUS Trust corpus, 17,000,000 Trust units issued and outstanding at June 30, 2024 and December 31, 2023 $ 12,687,168 $ 13,372,565 (Unaudited) Three months ended June 30, Six months ended June 30, 2024 2023 2024 2023 Trust corpus, beginning of period $ 12,928,840 $ 14,619,274 $ 13,372,565 $ 15,048,316 Income from net profits interest 3,377,463 4,222,042 6,981,577 8,550,794 Cash distributions (3,060,000 ) (3,910,000 ) (6,290,000 ) (7,820,

NOTES TO FINANCIAL STATEMENTS

NOTES TO FINANCIAL STATEMENTS (Unaudited) Note 1. Organization of the Trust VOC Energy Trust (the “Trust”) is a statutory trust formed on November 3, 2010 (capitalized on December 17, 2010), under the Delaware Statutory Trust Act pursuant to a Trust Agreement dated November 3, 2010 (as amended and restated on May 10, 2011, the “Trust Agreement”) among VOC Brazos Energy Partners, L.P., a Texas limited partnership (“VOC Brazos”), as trustor, The Bank of New York Mellon Trust Company, N.A., as Trustee (the “Trustee”), and Wilmington Trust Company, as Delaware Trustee (the “Delaware Trustee”). The Trust was created to acquire and hold a term net profits interest for the benefit of the Trust unitholders. VOC Brazos is a privately held limited partnership engaged in the production and development of oil and natural gas from properties located in Texas. VOC Kansas Energy Partners, L.L.C., a Kansas limited liability company (“VOC Kansas”), is a privately held limited liability company engaged in the production and development of oil and natural gas from properties primarily located in Kansas along with a limited number of Texas properties. In connection with the closing of the initial public offering of units of beneficial interest in the Trust (“Trust Units”) in May 2011, VOC Brazos acquired all of the membership interests in VOC Kansas in exchange for newly issued limited partner interests in VOC Brazos pursuant to a Contribution and Exchange Agreement, dated August 30, 2010, as amended, by and between VOC Brazos and VOC Kansas. This resulted in VOC Kansas becoming a wholly-owned subsidiary of VOC Brazos. The Trust was created to acquire and hold a term net profits interest representing the right to receive 80% of the net proceeds (calculated as described below in Note 5) from production from the underlying properties (as defined below). The net profits interest consists of working

Financial Statements of Royalty Trusts

Financial Statements of Royalty Trusts. Investment in the net profits interest was recorded initially at the historical cost of VOC Brazos and is periodically assessed to determine whether its aggregate value has been impaired below its total capitalized cost based on the underlying properties. The Trust will provide a write-down to its investment in the net profits interest if and when total capitalized costs, less accumulated amortization, exceeds undiscounted future net revenues attributable to the proved oil and gas reserves of the underlying properties. There was no impairment of the investment in the net profits interest during the quarters ended June 30, 2024 or 2023. No new accounting pronouncements were adopted or issued during the quarter ended June 30, 2024 that would impact the financial statements of the Trust. Note 4. Investment in Net Profits Interest The net profits interest was recorded at the historical cost of VOC Brazos on May 10, 2011, the date of the conveyance of the net profits interest to the Trust, and was calculated as follows: Oil and gas properties $ 197,270,173 Accumulated depreciation and depletion (17,681,155 ) Hedge liability (1,717,713 ) 20-year asset retirement liability (2,131,797 ) Net property to be conveyed 175,739,508 Times 80% net profits interest to Trust $ 140,591,606 3 Note 5. Income from Net Profits Interest Three months ended June 30, Six months ended June 30, 2024 2023 2024 2023 Excess of revenues over direct operating expenses and lease equipment and development costs (1) $ 4,221,829 $ 5,277,552 $ 8,726,971 $ 10,688,492 Times 80% net profits interest to Trust 80 % 80 % 80 % 80 % Income from net profits interest before reserve adjustments 3,377,463 4,222,042 6,981,577 8,550,794 VOC Brazos reserve for future development, maintenance or operating expenditures (2) — — — — Income from net profits interest (3) $ 3,377,463 $ 4,222,042 $ 6,

Trustee’s Discussion and Analysis of Financial Condition

Item 2. Trustee’s Discussion and Analysis of Financial Condition and Results of Operations. The following discussion of the Trust’s financial condition and results of operations should be read in conjunction with the financial statements and notes thereto. The Trust’s purpose is, in general, to hold the net profits interest, to distribute to the Trust unitholders cash that the Trust receives in respect of the net profits interest and to perform certain administrative functions in respect of the net profits interest and the Trust Units. The Trust derives substantially all of its income and cash flows from the net profits interest. All information regarding operations has been provided to the Trustee by VOC Brazos. Results of Operations Results of Operations for the Quarters Ended June 30, 2024 and 2023 The following is a summary of income from net profits interest received by the Trust for the three months ended June 30, 2024 and 2023 consisting of the April distribution for each respective year: Three months ended June 30, 2024 2023 Sales volumes: Oil (Bbl) 110,534 120,771 Natural gas (Mcf) 64,808 74,644 Total (BOE) 121,335 133,212 Average sales prices: Oil (per Bbl) $ 71.25 $ 74.16 Natural gas (per Mcf) $ 3.10 $ 5.37 Gross proceeds: Oil sales $ 7,875,193 $ 8,955,923 5 Three months ended June 30, 2024 2023 Natural gas sales 201,034 401,092 Total gross proceeds 8,076,227 9,357,015 Costs: Production and development costs: Lease operating expenses 3,312,352 3,637,884 Production and property taxes 183,728 279,484 Development expenses 358,318 162,095 Total costs 3,854,398 4,079,463 Excess of revenues over direct operating expenses and lease equipment and development costs 4,221,829 5,277,552 Times net profits interest over the term of the Trust 80 % 80 % Income from net profits interest before reserve adjustments 3,377,463 4,222,042 VOC Brazos reserve for future dev

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