San Juan Basin Royalty Trust (SJT) Q1 2025 earnings summary

Executive summary

• Royalty and distributable income for Q1 2025 fell to zero due to high capital expenditures, increased lease operating expenses, and a sharp decline in natural gas prices.

• No cash distributions for Q1 2025, with distributable income down from $4.1 million ($0.087806 per unit) in Q1 2024.

• Interest income declined in Q1 2025 due to lack of royalty income and reduced cash reserves.

• General and administrative expenses fell by 50% year-over-year, mainly due to timing differences and prior year transition costs.

• Hilcorp's 2025 capital plan includes $9.0 million in expenditures across 29 projects, with $1.25 million spent as of March 31, 2025.

Financial highlights

• Royalty income for Q1 2025 was $0, compared to $5,091,060 in Q1 2024.

• Distributable income for Q1 2025 was $0, compared to $4,092,544 in Q1 2024.

• Cash reserves stood at $258,521 as of March 31, 2025, down from $1,800,000 in April 2024 and $760,920 at year-end 2024.

• Excess Production Costs increased to $21.7 million gross ($16.3 million net to the Trust) as of March 31, 2025.

• General and administrative expenses for Q1 2025 were $510,636, down from $1,016,171 in Q1 2024.

Outlook and guidance

• Substantial doubt exists about the Trust's ability to continue as a going concern within one year after the financial statement issuance.

• No distributions will be made until Excess Production Costs are extinguished, Trust liabilities are paid, and cash reserves are replenished.

• Trustee is negotiating a commercial line of credit to cover liabilities once cash reserves are depleted.

• Trust expects to continue drawing on cash reserves for liabilities until royalty income resumes.

• Hilcorp's 2025 capital plan may be revised, and actual costs may differ from estimates.