The Trustees of Mesabi Trust (NYSE: MSB) declared a distribution of sixty-four ($0.64) per Unit of Beneficial Interest payable on August 20, 2012 to Mesabi Trust unitholders of record at the close of business on July 30, 2012. This compares to a distribution of sixty cents ($0.60) per Unit for the same period last year.
The increase in the current distribution of four cents ($0.04) per Unit, as compared to the same quarter last year, is attributable to an increase in the average sales price per ton of iron ore pellets and, to a lesser extent, an increase in the volume of shipments for the second calendar quarter of 2012 and year to date. The base and bonus royalties payable to Mesabi Trust (before the application of pricing adjustments by Northshore) increased from approximately $7.9 million in the second calendar quarter of 2011 to approximately $8.6 million for the second calendar quarter of 2012, an increase of approximately 9%.
Based on shipments of iron ore pellets during the second calendar quarter of 2012 reported by Northshore, Mesabi Trust expects to be credited with a base royalty of $4,392,772 (based on actual shipments of 1,560,718 tons of iron ore mined from Mesabi Trust lands). Mesabi Trust also expects to be credited with a bonus royalty in the amount of $4,240,219 based on the average sales price per ton of iron ore pellets and the volume of shipments during the second calendar quarter of 2012. In addition to the base and bonus royalty payments, Mesabi Trust is also expecting to receive $9,848 as a result of positive pricing adjustments to shipments and royalty payments made in the first calendar quarter of 2012. Accordingly, the total royalty payment expected to be received on July 30, 2012 by Mesabi Trust from Northshore is $8,859,696 (which includes a royalty payment of $216,857 payable to the Mesabi Land Trust).