Mesabi Trust Press Release
April 14 2017 - 4:36PM
Business Wire
The Trustees of Mesabi Trust (NYSE:MSB) declared a distribution
of fifty-five cents ($0.55) per Unit of Beneficial Interest payable
on May 20, 2017 to Mesabi Trust Unitholders of record at the close
of business on April 30, 2017. This compares to a distribution of
twenty cents ($0.20) per Unit of Beneficial Interest for the same
period last year.
The thirty-five cents ($0.35) per Unit increase in the current
distribution, as compared to the same quarter last year, is
primarily attributable to the Mesabi Trustees’ consideration of the
Trust’s receipt of $9,791,421 in total royalty payments paid to the
Trust on January 30, 2017 by Northshore Mining Company
(“Northshore”) for iron ore shipments during the fourth calendar
quarter out of Silver Bay, Minnesota. The Trustees’ determination
of the fifty-five cents ($0.55) distribution announced today also
reflects the Trust’s recognition of $2,099,415 in negative pricing
adjustments recognized by Mesabi Trust in the last month of the
fiscal year ended January 31, 2017, which will offset future
royalties that would otherwise be paid to the Trust, as well as the
Trustees’ continuing effort to maintain a prudent level of
unallocated reserve in order for the Trust to be in position to
meet current and future expenses, and any present and future
liabilities (whether fixed or contingent) that may arise in
connection with the current and ongoing challenges in the iron ore
and steel industries. Finally, the increase in the current
distribution compared to a year ago also reflects the fact that
during the first calendar quarter of 2016, Northshore’s iron ore
pellet production in Silver Bay, Minnesota had been temporarily
idled.
Quarterly royalty payments earned for iron ore shipments made
during the calendar quarter ended March 31, 2017, if any,
payable by Northshore to Mesabi Trust under the royalty agreement,
are due on April 30, 2017, together with the quarterly royalty
report. After receiving the report, Mesabi Trust plans to file a
summary of the quarterly royalty report with the Securities and
Exchange Commission in a Current Report on Form 8-K.
This press release contains certain forward-looking statements
with respect to iron ore pellet production, iron ore pricing and
adjustments to pricing, iron ore shipments, royalty (including
bonus royalty) amounts, and other matters, which statements are
intended to be made under the safe harbor protections of the
Private Securities Litigation Reform Act of 1995, as amended.
Actual production, prices, price adjustments, and shipments of
iron ore pellets, as well as actual royalty payments (including
bonus royalties) could differ materially from current expectations
due to inherent risks and uncertainties such as general adverse
business and industry economic trends, uncertainties arising from
war, terrorist events, natural disasters, weather conditions and
other global events, higher or lower customer demand for steel and
iron ore, decisions by mine operators regarding curtailments or
idling production lines or entire plants, environmental compliance
uncertainties, difficulties in obtaining and renewing necessary
operating permits, higher imports of steel and iron ore
substitutes, processing difficulties, consolidation and
restructuring in the domestic steel market, indexing features in
Cliffs Pellet Agreements resulting in adjustments to royalties
payable to Mesabi Trust and other factors. Further, substantial
portions of royalties earned by Mesabi Trust are based on estimated
prices that are subject to interim and final adjustments, which can
be positive or negative, and are dependent in part on multiple
price and inflation index factors under agreements to which Mesabi
Trust is not a party and that are not known until after the end of
a contract year. Although the Mesabi Trustees believe that any such
forward-looking statements are based on reasonable assumptions,
such statements are subject to risks and uncertainties, which could
cause actual results to differ materially. Additional information
concerning these and other risks and uncertainties is contained in
the Trust’s filings with the Securities and Exchange Commission,
including its Annual Report on Form 10-K. Mesabi Trust undertakes
no obligation to publicly update or revise any of the
forward-looking statements made herein to reflect events or
circumstances after the date hereof.
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