Natural Resource Partners Q2 2026 Earnings Report

Natural Resource Partners EPS Results

• Actual EPS: $1.85
• Consensus EPS: $0.30
• Beat/Miss: Beat by +$1.55
• One Year Ago EPS: N/A

Natural Resource Partners Revenue Results

• Actual Revenue: $52.97 million
• Expected Revenue: $37.70 million
• Beat/Miss: Beat by +$15.27 million
• YoY Revenue Growth: N/A

Natural Resource Partners Announcement Details

• Quarter: Q2 2026
• Date: 8/5/2026
• Time: Before Market Opens
• Conference Call Date: Wednesday, August 5, 2026
• Conference Call Time: 9:00AM ET

Natural Resource Partners (NYSE:NRP) (NYSE: NRP) is a master limited partnership that acquires and manages royalty and other mineral interests in coal and other natural resources across North America and Australia. The partnership was formed in 2010 as a spin-out from a major U.S. coal producer and is headquartered in Fairmont, West Virginia. Its core business model centers on owning gross proceeds interests, gross royalty proceeds interests and fee minerals, which provide the right to receive a portion of revenues from mining and mineral production without operating the mines directly.

NRP’s U.S. portfolio spans the central Appalachian Basin, northern West Virginia, southwest Virginia, Colorado’s North Fork Valley, and northwest New Mexico and Arizona. These assets encompass both thermal and metallurgical coal deposits as well as fee mineral estates that cover precious and base metals. In Australia, the partnership holds an equity interest in a thermal coal development project in Queensland. By structuring its holdings around royalties and flow-through interests, NRP can benefit from multiple revenue streams tied to commodity prices and production levels while avoiding the capital expenditures and operating risks associated with direct mining operations.

Throughout its history, Natural Resource Partners has focused on growing its royalty footprint through strategic acquisitions of mineral interests sold by private and public mining companies. The board and management team leverage decades of experience in mineral leasing, asset evaluation and capital markets to identify and secure high-quality interests. This approach aims to deliver stable cash flows over the long term, making NRP an option for investors seeking exposure to coal and mineral royalties without direct operational involvement in resource extraction.

Natural Resource Partners Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: NRP generated $42 million in second-quarter free cash flow and $163 million over the trailing 12 months before its soda ash investment. Management said the mineral rights segment remains a dependable cash generator across commodity cycles.
• Positive Sentiment: The company repaid its bank revolver and has only $14 million of debt remaining, with the final scheduled payment due in December. Management expects to significantly increase common-unit distributions beginning with the payment planned for November.
• Negative Sentiment: The soda ash market remains oversupplied, with weak flat-glass demand and international prices below most producers’ costs. NRP expects domestic soda ash prices to decline as 2027 contracts are negotiated, and does not expect distributions from Sisecam Wyoming to resume until demand improves or supply is reduced.
• Neutral Sentiment: Second-quarter net income was $25 million, while mineral rights net income was $36 million; mineral rights free cash flow was $45 million. Mineral rights earnings were pressured by higher depletion expense from revised mine plans, partly offset by higher metallurgical and thermal coal volumes and pricing.
• Negative Sentiment: Management said thermal coal faces ongoing long-term pressure from increasingly competitive renewables, while higher oil prices can increase associated natural-gas production and weigh on North American thermal coal prices. Coal markets have modestly improved from their lows, but executives do not foresee a clear catalyst for a sharp price recovery.

Presentation

[Operator]

Hello, everyone. Thank you for joining us, and welcome to the Natural Resource Partners L.P. Second Quarter 2026 Earnings Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Tiffany Sammis, Investor Relations. Tiffany, please go ahead.

[Tiffany Sammis, Investor Relations at Natural Resource Partners]

Thank you, good morning, and welcome to the Natural Resource Partners Second Quarter 2026 Conference Call. Today's call is being webcast, and a replay will be available on our website. Joining me today are Craig Nunez, President and Chief Operating Officer, Chris Zolas, Chief Financial Officer, and Kevin Craig, Executive Vice President. Some of our comments today may include forward-looking statements reflecting NRP's views about future events. These matters involve risks and uncertainties that could cause our actual results to materially differ from our forward-looking statements. These risks are discussed in NRP's Form 10-K and other Securities and Exchange Commission filings. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. Our comments today also include non-GAAP financial measures.

[Tiffany Sammis, Investor Relations at Natural Resource Partners]

Additional details and reconciliations to the most directly comparable GAAP measures are included in our second quarter press release, which can be found on our website. I would like to remind everyone that we do not intend to discuss the operations or outlook for any particular coal lessee or detailed market fundamentals. I would like to turn the call over to Craig Nunez, our President and Chief Operating Officer.

[Craig Nunez, President and COO at Natural Resource Partners]

Thank you, Tiffany, good morning, everyone. NRP generated $42 million of free cash flow in the second quarter and $163 million of free cash flow over the last 12 months before the $39 million we put to work in our soda ash business back in the first quarter. The world has been noisy recently. Geopolitical conflict, shipping disruptions, tariff fights. I don't know how those will resolve. What I do know is that we paid off our bank revolver last month and have only $14 million of debt outstanding. Barring something unforeseen, we intend to raise distributions significantly in November. Coal, both metallurgical and thermal, has settled down and shown modest improvement off the lows. I can't point to any single event that's likely to push prices sharply higher from here. We're not in the business of predicting commodity prices anyway.

[Craig Nunez, President and COO at Natural Resource Partners]

What matters more is that our mineral rights segment just keeps doing what it's done for years, producing cash, rain or shine. Through every major coal cycle, it has been the most dependable cash generator we've ever owned. On thermal coal, if oil prices remain high, that tends to bring more associated natural gas production along with it, which puts downward pressure on thermal coal prices in North America. Cheaper oil would work the other way. Meanwhile, renewables keep getting more competitive, that will pose a long-term headwind for thermal coal. Now, soda ash. The honest picture is that global supply still exceeds demand, we don't see a quick fix. The encouraging sign is that international prices, after a long and painful decline, appear to have found the floor. But it's a floor below most producers' cost of production, which tells you the downturn still has room to run.

[Craig Nunez, President and COO at Natural Resource Partners]

Domestic soda ash prices have always traded at a premium to international prices due to transportation cost, trade frictions, and the value domestic customers place on reliable supply. That premium is unusually wide right now, mostly because domestic contracts get set once a year, while international prices move with the spot market. As a result, domestic prices haven't caught up with how far international prices have fallen. As contracts for 2027 deliveries get negotiated this year, we expect that gap to close, which means lower domestic prices ahead. We've seen this movie before. The 1999-2004 downturn looked a lot like today's market, it eventually corrected as supply and demand found their way back into balance. We're starting to see hints of that with recent announcements of extended closures amounting to roughly 4% of global capacity. Markets have a way of curing their own excesses, given time.

[Craig Nunez, President and COO at Natural Resource Partners]

To sum it up, despite challenges for all three of our key commodities, NRP is generating strong free cash flow. We're almost debt-free, barring the unexpected, we plan to raise distributions significantly starting in November. With that, I'll turn it over to Chris.

[Chris Zolas, CFO at Natural Resource Partners]

Thank you, Craig. In the second quarter of 2026, NRP generated $25 million of net income, $41 million of operating cash flow, and $42 million of free cash flow. Of these second quarter consolidated amounts, our mineral rights segment generated $36 million of net income and $45 million of operating and free cash flow. When compared to the prior year second quarter, mineral rights segment net income decreased by $3 million, primarily due to increased DD&A expense caused by revised mine plans at certain longwall thermal coal mines that resulted in higher per ton depletion rates. This decrease in net income was partially offset by increased revenues, primarily due to increased metallurgical and thermal volumes and pricing at certain properties.

[Chris Zolas, CFO at Natural Resource Partners]

Operating cash flow and free cash flow each decreased $1 million as compared to the prior year period, primarily due to higher recoupments during the three months ended June 30th, 2026, partially offset by increased cash from minimum payments during the quarter.

[Chris Zolas, CFO at Natural Resource Partners]

Regarding our met thermal coal royalty mix, metallurgical coal made up approximately 70% of our coal royalty revenues and 45% of coal royalty sales volumes in the second quarter of 2026. Our soda ash segment's second quarter net income decreased to $7 million compared to the prior year quarter. This decrease was driven by lower sales prices due to the oversupplied international soda ash market and weakened demand for flat glass. Operating and free cash flow each decreased $5 million when compared to the prior year period. These decreases were due to not receiving a distribution in the second quarter of 2026 as compared to receiving a $5 million distribution in the second quarter of last year. NRP does not expect distributions from Sisecam Wyoming to resume until the soda ash demand rebounds or there is a significant supply response to this depressed market.

[Chris Zolas, CFO at Natural Resource Partners]

Moving to our corporate and financing results, net income for the second quarter of 2026 improved $2 million, while operating cash flow and free cash flow each improved $1 million as compared to the prior year period. These improvements were due to having less debt outstanding, resulting in lower interest costs and less cash paid for interest. Regarding our quarterly distributions, in May, we paid the first quarter distribution of $0.75 per common unit, today we announced our second-quarter distribution of $0.75 per common unit to be paid later this month. Regarding our debt, I'm pleased and proud to report that we've now completely repaid our OpCo credit facility and have one final $14 million scheduled payment due in December on our OpCo senior notes.

[Chris Zolas, CFO at Natural Resource Partners]

As a result, as Craig mentioned earlier, we expect to be able to significantly increase NRP unit holder distributions for the next quarterly distribution to be paid in November. With that, I'll turn the call over to Trevor, our operator for questions.

[Operator]

Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile a Q&A roster. There are no questions at this time. I will now turn the call back to Craig Nunez for closing remarks. Craig, go ahead.

[Craig Nunez, President and COO at Natural Resource Partners]

Thank you, Trevor, and thank you everyone for joining our call today, and thank you for being partners with us at NRP. I look forward to talking to you next quarter. Have a good day.

[Operator]

This concludes today's call. Thank you for attending. You may now disconnect.

Participants

Executives

• Tiffany Sammis, Investor Relations
• Craig Nunez, President and COO
• Chris Zolas, CFO