HOUSTON, TX - Natural Resource Partners LP (NYSE:NRP), a leader in bituminous coal and lignite surface mining, has amended its credit agreement, extending the maturity date and adjusting the terms related to restricted payments. The changes were made through the Seventh Amendment to the Third Amended and Restated Credit Agreement with lender commitments totaling $200.0 million.
The amendment, effective as of Monday, extends the maturity date of the credit facility from August 2027 to October 2029. Additionally, it modifies the company's capacity to declare and make certain restricted payments. Natural Resource Partners LP has filed the Seventh Amendment as Exhibit 10.1 to the Current Report on Form 8-K.
The credit facility, initially dated June 16, 2015, involves NRP (Operating) LLC as the borrower and Zions Bancorporation (NASDAQ:ZION), N.A. dba Amegy Bank as the administrative and collateral agent. The extended credit facility is expected to provide the company with continued financial flexibility.
Natural Resource Partners LP, headquartered in Houston, Texas, is incorporated in Delaware and operates under the standard industrial classification of bituminous coal and lignite surface mining. The company's fiscal year ends on December 31.
In other recent news, Natural Resource Partners L.P. has made significant strides in its financial dealings. The company recently completed the redemption of all its remaining Class A Preferred Units, a total cash payment of $31,666,000, marking the retirement of the last 31,666 preferred units. This action simplifies the company's capital structure, potentially offering more transparent financials for investors and analysts.
On the earnings front, Natural Resource Partners reported a robust free cash flow of $57 million for the second quarter of 2024, despite declining metallurgical coal and soda ash prices. This demonstrates the company's financial resilience and ability to meet its financial obligations. Furthermore, the company reduced its total financial obligations by 35% from the previous year, now standing at approximately $240 million.
In terms of distributions, the company announced quarterly distributions of $0.75 per common unit. Despite challenges in the market, Natural Resource Partners continues to explore carbon neutral initiatives and manage its soda ash business, although this segment experienced a decrease in net income.
InvestingPro Insights
Natural Resource Partners LP's recent credit agreement amendment aligns with its strong financial position and commitment to shareholder value. According to InvestingPro data, the company boasts a market capitalization of $1.27 billion and an impressive gross profit margin of 89.61% for the last twelve months as of Q2 2024. This high profitability is reflected in an InvestingPro Tip highlighting the company's "impressive gross profit margins."
The extension of the credit facility's maturity date to October 2029 provides NRP with enhanced financial flexibility, which is crucial given its moderate debt levels, as noted in another InvestingPro Tip. This financial prudence is further evidenced by the company's ability to maintain dividend payments for 17 consecutive years, with a current dividend yield of 5.61%.
Investors may be interested to know that NRP has been delivering strong returns, with a one-year price total return of 40.64% as of the latest data. The stock is currently trading near its 52-week high, at 95.4% of that peak, suggesting investor confidence in the company's performance and outlook.
For those seeking a deeper understanding of NRP's financial health and potential, InvestingPro offers 10 additional tips, providing a comprehensive analysis to inform investment decisions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.