NEW YORK – Mesabi Trust (NYSE:MSB), a mineral royalty trader, announced on Thursday that it received total royalty payments of $5,325,522 on July 30, 2024, which is based on the iron ore shipments from Silver Bay, Minnesota. This figure reflects an increase in iron ore shipments as compared to the same quarter in the previous year.
The royalty income was reported in a quarterly royalty report provided by Cleveland-Cliffs Inc. (NYSE:CLF), the parent company of Northshore Mining Company. The report detailed the shipments of iron ore products during the quarter ended June 30, 2024.
The Trust's base royalty was $2,783,747, with a bonus royalty of $2,386,069 added for the quarter. An additional royalty payment of $155,706 was paid to the Mesabi Land Trust. According to the report, there were no adjustments made to the royalties in the second quarter.
Shipments for the quarter totaled 949,718 tons, an increase from the 886,301 tons shipped in the second quarter of 2023. The report also mentioned two low volume sale transactions of iron ore pellets to a third-party customer, which are currently under review by the Trust to ensure they meet the requirements of the royalty agreement.
The Trust noted that the volume of shipments and production can vary significantly from quarter to quarter due to factors such as operational decisions by Cliffs, customer delivery schedules, general economic conditions, and weather conditions affecting the Great Lakes.
The Trustees of Mesabi Trust have not received specific updates about Cliffs' plans for Northshore iron ore operations. However, the last public announcement from Cliffs in April 2023 indicated that Northshore would operate at less than full capacity for the remainder of 2023 and would be considered a swing operation.
InvestingPro Insights
In light of Mesabi Trust's recent royalty payments announcement, insights from InvestingPro reveal significant financial metrics that may interest investors. Mesabi Trust (NYSE:MSB) stands out with a Price to Earnings (P/E) ratio of 10.68, which aligns closely with the adjusted P/E ratio for the last twelve months as of Q1 2025 at 10.64. This valuation metric suggests that the company's earnings are robust relative to its share price. Additionally, the company's Price to Book (P/B) ratio for the same period is 11.05, indicating a premium valuation of the company's net assets.
InvestingPro Tips highlight that Mesabi Trust holds more cash than debt on its balance sheet and pays a significant dividend to shareholders, with a noteworthy dividend yield of 6.83% as of 2024. Moreover, the company has a long-standing history of dividend payments, maintaining them for 35 consecutive years. These factors combined with the company's low price volatility could make Mesabi Trust an attractive option for income-focused investors.
For those seeking additional insights, InvestingPro offers a range of tips, including information on Mesabi Trust's liquid assets and profitability over the last twelve months. To explore these further, investors can visit https://www.investing.com/pro/MSB, where they can find a total of seven InvestingPro Tips that may guide investment decisions regarding Mesabi Trust.
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