Natural Resource Partners LP

All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. To ask a question, simply press star 1 on your telephone keypad. To withdraw your question, press star 1 again. Thank you. It is now my pleasure to turn the call over to Tiffany Samas, Investor Relations. Please go ahead.

Thank you. Good morning, and welcome to the Natural Resource Partners third quarter 2025 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. Additional details and reconciliations to the most directly comparable GAAP measures are included in our third 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 SE or detailed market fundamentals. Now, I would like to turn the call over to Craig Nunes, our President and Chief Operating Officer.

Thanks, Tiffany, and good morning, everyone. NRP generated $42 million of free cash flow in the third quarter of 2025 and $190 million of free cash flow over the last 12 months. We continue to generate substantial free cash flow despite significant headwinds for all three of our key commodities, metallurgical coal, thermal coal, and SODASH. Metallurgical coal markets are challenged by slowing global growth and soft steel demand. Thermal coal markets are struggling with muted demand caused by mild weather, cheap natural gas, slowing global growth, and renewable energy adoption. While the prospects for a more accommodating regulatory environment and increased electricity demand from data centers have increased market optimism for thermal coal, we have not yet seen any material support for prices or demand. While we acknowledge that these factors offer the potential for a more bullish long-term outlook, we will continue to manage the partnership in accordance with the thesis that North American thermal coal remains in long-term secular decline until we see evidence to the contrary. As we've said previously, we believe most coal operators are struggling to make money, with most producing at razor-thin margins and a growing number operating at a loss. We are seeing this play out in the announced results of publicly traded companies and recent bankruptcies of several smaller producers. While we have not identified a catalyst to turn the market around, we continue to believe that the vast majority of our lessees are in better financial shape than in previous downturns. We believe these factors, combined with our relatively robust free cash flow generating capability, solid and improving capital structure, and conservative management philosophy, position us well for navigating a very difficult cold market. The soda ash market remains oversupplied due to capacity additions and slowing global growth. International prices are below cash production costs for most producers. While we were early to share publicly our concerns regarding the potential for the supply-demand imbalances now plaguing the market, the depth and potential duration of the current downturn is more significant than we initially expected. We are in a generational bear market for soda ash, and there will be more pain to bear before the situation improves. If there is a silver lining to the cloud hanging over the soda ash market, It is that this dynamic is unsustainable in the long term. We expect producers will rationalize supply at some point, but we don't know when or how that will occur. Rebalancing supply and demand will likely take several years before prices return to levels enjoyed historically. As one of the world's lowest cost producers, Shisha Jam Wyoming continues to navigate this downturn well. In addition to aggressively managing costs and inventories, Shisha Jam is maintaining its focus on safety and system integrity, two areas that are sometimes overlooked during periods of challenging financial results. Our Sodash investment is a long-term asset with durable competitive advantages that will produce an essential global commodity for many years in the future. We are quite pleased that our managing partner is committed to maintaining the long-term integrity of our shared asset, even when near-term financial performance is down. We did not receive a distribution from Shisha Jam this quarter after receiving $8 million in distributions during the first half of the year. While we expect Shisha Jam Wyoming to remain profitable through the downturn, we do not expect it to resume distributions for the foreseeable future, with cash retained used for investments in safety and system integrity. The carbon neutral industry continues to struggle. Oxy notified us during the quarter that it was dropping its subsurface CO2 sequestration lease on 65,000 acres of pore space we own in Polk County, Texas. You'll recall that Exxon dropped its CO2 sequestration lease on 75,000 acres we own in Baldwin County, Alabama last year. As of now, none of our 3.5 million acres of CO2 sequestration pore space is under lease. You've heard me describe these sequestration rights as out-of-the-money call options on greatness. They cost us nothing to hold, they never expire, and we benefit if the market for CO2 sequestration goes up. I do not believe our leases were dropped due to any problems associated with our specific acreage. On the contrary, I think the locations leased to Oxy and Exxon are some of the highest quality CO2 pore space in the Gulf Coast. The entire CO2 sequestration industry remains burdened by high capital and operating costs, insufficient and inadequate revenue streams, and the lack of a consistent regulatory framework. These factors have created formidable economic barriers that operators are either unable or unwilling to overcome. Our call options on sequestration pore space will remain out of the money until and unless these industry challenges are resolved. In conclusion, Coal and soda ash prices are down, and we do not see near-term catalysts for market improvement. Our coal lessees are operating at or near their cost of production, and our soda ash investment is experiencing the lowest international sales prices in decades. Despite this, NRP continues to generate robust free cash flow and make progress toward our goal of retiring all outstanding debt. Over the past 12 months, we have retired nearly $130 million of debt with only $70 million of debt remaining as of the end of the quarter. We continue to believe that we will be in a position to increase unit holder distributions in August. However, I caution that the longer we slog through the depths of bear markets for all three of our key commodities, the greater the likelihood that some event occurs that pushes that timing back. Rest assured, however, that we will continue to manage the partnership with a conservative mindset in order to protect your investment and be best prepared for negative events that may arise. And with that, I'll turn it over to Chris to cover the financials.