Black Stone Minerals 2025 Q1 Earnings Net Income Declines 75%
Wednesday, May 7, 2025 6:58 am ET
54min read Black Stone Minerals (BSM) reported its fiscal 2025 Q1 earnings on May 6th, 2025. Black Stone Minerals missed expectations with a significant decrease in both revenue and net income. The company has maintained its distribution at $0.375 per unit, reflecting a commitment to shareholder returns despite financial challenges. Looking ahead, Black Stone anticipates benefits from near-term development activity across high-interest acreage, with ongoing monitoring of price environments and asset activity levels. While net income declined, strategic mineral acquisitions and development activities offer long-term growth potential.
Revenue
Black Stone Minerals saw a decline in total revenue to $59.25 million for Q1 2025, representing a 43.8% drop from $105.49 million in Q1 2024. The oil and condensate segment generated revenue of $50.09 million, while natural gas and natural gas liquids contributed $58.23 million. Lease bonus and other income amounted to $6.92 million, offset by a loss on commodity derivative instruments of $56 million.
Earnings/Net Income
Black Stone Minerals’ earnings per share (EPS) fell sharply by 85.2%, reaching $0.04 in Q1 2025 compared to $0.27 in Q1 2024. The company’s net income decreased significantly to $15.95 million, down 75.1% from $63.93 million in the previous year. This quarter reflects a challenging financial performance.
Price Action
The stock price of Black Stone Minerals edged up 1.16% during the latest trading day, experienced a downturn of 2.84% over the full trading week, and dropped 6.04% month-to-date.
Post Earnings Price Action Review
The strategy of purchasing Black Stone Minerals shares following a quarterly revenue drop and holding for 30 days resulted in a modest return of 7.36%. This performance significantly underperformed the benchmark, which achieved a return of 83.12%. The strategy demonstrated a compound annual growth rate (CAGR) of 1.45%, with a maximum drawdown of -14.79%. The Sharpe ratio stood at 0.12, indicating that while the strategy managed risk, it delivered moderate returns. Overall, the strategy's performance underscores the challenges in achieving substantial gains amidst revenue declines.
CEO Commentary
Thomas L. Carter, Jr., Chairman, Chief Executive Officer, and President of Black Stone Minerals, emphasized the company's strong financial position and promising asset outlook despite market volatility. Carter highlighted the maintenance of the quarterly distribution at $0.375 per unit, attributing the 0.93x distribution coverage impact to a seismic license expenditure designed to enhance subsurface evaluation and mineral acquisition potential in the Shelby Trough area. He expressed confidence in long-term growth opportunities from targeted mineral acquisitions and indicated that the company is positioned to benefit from ongoing development activities across high-interest oil and gas regions.
Guidance
Black Stone Minerals anticipates continued benefits from near-term development activity and production on unique high-interest acreage in oil- and gas-focused regions. The company is closely monitoring the current price environment and activity levels across its assets. CEO Thomas L. Carter, Jr. emphasized ongoing progress in targeted mineral acquisitions, reinforcing confidence in long-term growth opportunities that will enhance value for unitholders.
Additional News
Recently, Black Stone Minerals declared a cash distribution of $0.375 per common unit for Q1 2025, maintaining consistency with the prior quarter. The distribution will be payable on May 15, 2025, to unitholders of record on May 8, 2025. Additionally, Black Stone has been active in mineral acquisitions, having acquired over $160 million in minerals since September 2023. This strategic move aligns with the company's long-term growth strategy and capitalizes on its natural gas strategy, further strengthening its asset portfolio. No major C-level changes have been announced recently, ensuring stability in leadership.
Revenue
Black Stone Minerals saw a decline in total revenue to $59.25 million for Q1 2025, representing a 43.8% drop from $105.49 million in Q1 2024. The oil and condensate segment generated revenue of $50.09 million, while natural gas and natural gas liquids contributed $58.23 million. Lease bonus and other income amounted to $6.92 million, offset by a loss on commodity derivative instruments of $56 million.
Earnings/Net Income
Black Stone Minerals’ earnings per share (EPS) fell sharply by 85.2%, reaching $0.04 in Q1 2025 compared to $0.27 in Q1 2024. The company’s net income decreased significantly to $15.95 million, down 75.1% from $63.93 million in the previous year. This quarter reflects a challenging financial performance.
Price Action
The stock price of Black Stone Minerals edged up 1.16% during the latest trading day, experienced a downturn of 2.84% over the full trading week, and dropped 6.04% month-to-date.
Post Earnings Price Action Review
The strategy of purchasing Black Stone Minerals shares following a quarterly revenue drop and holding for 30 days resulted in a modest return of 7.36%. This performance significantly underperformed the benchmark, which achieved a return of 83.12%. The strategy demonstrated a compound annual growth rate (CAGR) of 1.45%, with a maximum drawdown of -14.79%. The Sharpe ratio stood at 0.12, indicating that while the strategy managed risk, it delivered moderate returns. Overall, the strategy's performance underscores the challenges in achieving substantial gains amidst revenue declines.
CEO Commentary
Thomas L. Carter, Jr., Chairman, Chief Executive Officer, and President of Black Stone Minerals, emphasized the company's strong financial position and promising asset outlook despite market volatility. Carter highlighted the maintenance of the quarterly distribution at $0.375 per unit, attributing the 0.93x distribution coverage impact to a seismic license expenditure designed to enhance subsurface evaluation and mineral acquisition potential in the Shelby Trough area. He expressed confidence in long-term growth opportunities from targeted mineral acquisitions and indicated that the company is positioned to benefit from ongoing development activities across high-interest oil and gas regions.
Guidance
Black Stone Minerals anticipates continued benefits from near-term development activity and production on unique high-interest acreage in oil- and gas-focused regions. The company is closely monitoring the current price environment and activity levels across its assets. CEO Thomas L. Carter, Jr. emphasized ongoing progress in targeted mineral acquisitions, reinforcing confidence in long-term growth opportunities that will enhance value for unitholders.
Additional News
Recently, Black Stone Minerals declared a cash distribution of $0.375 per common unit for Q1 2025, maintaining consistency with the prior quarter. The distribution will be payable on May 15, 2025, to unitholders of record on May 8, 2025. Additionally, Black Stone has been active in mineral acquisitions, having acquired over $160 million in minerals since September 2023. This strategic move aligns with the company's long-term growth strategy and capitalizes on its natural gas strategy, further strengthening its asset portfolio. No major C-level changes have been announced recently, ensuring stability in leadership.
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