CROSS TIMBERS ROYALTY TRUST
For the period ended Jun 30, 2024. Filed Aug 13, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 13, 2024
CRT$12.72+2.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-14.
0000950170-24-059607
Item 2. Trustee’s Discussion and AnalysisCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-13.
0000950170-24-096269
Item 2. Trustee’s Discussion and AnalysisThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 45 previous paragraphs and 49 current paragraphs.
33 unchanged; 8 reworded; 6 added; 4 removed; 0 previous and 2 current paragraphs rearranged.
Tables are not compared: 2 previous and 2 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (6)
Current report
Oil sales volumes increased three percent for the second quarter and increased one percent for the six-month period primarily due to the timing of cash receipts, partially offset by natural production decline.
Current report
The average oil price for the second quarter increased four percent to $77.24 per Bbl and for the six-month period decreased one percent to $76.28 per Bbl.
Current report
Gas prices for the second quarter decreased 66 percent to $4.04 per Mcf and for the six-month period decreased 39 percent to $4.26 per Mcf.
Current report
Production expense decreased four percent for the second quarter primarily because of decreased power and fuel costs and miscellaneous non-operated costs, partially offset by increased repairs and maintenance and labor costs. Production expense decreased three percent for the six-month period primarily because of the absence of higher processing costs driven by timing of receipts, decreased power and fuel costs and miscellaneous non-operated costs, partially offset by increased repairs and maintenance and labor costs.
Removed paragraphs (4)
Previous report
Oil sales volumes decreased 1 percent from first quarter 2023 to first quarter 2024 primarily due to natural production decline.
Previous report
The average oil price decreased 6 percent to $75.30 per Bbl for first quarter 2024.
Previous report
The average gas price decreased 16 percent to $4.57 per Mcf for first quarter 2024.
Previous report
Production expense decreased 2 percent for first quarter 2024 primarily because of of lower processing costs driven by timing of receipts, partially offset by increased repairs and maintenance costs and labor costs.
Reworded paragraphs (8)
Previous wording
After considering interest income of $16,973 and administration expense of $361,500, distributable income for the quarter ended March 31, 2024,was $1,493,214, or $0.248869 per unit of beneficial interest. Administration expense for the quarter increased $73,656 from the prior year quarter, primarily related to the timing of receipt and payment of Trust expenses and terms of professional services. Changes in interest income are attributable to fluctuations in net profits income, expense reserve, and interest rates. For first quarter 2023, distributable income was $3,639,198, or $0.606533 per unit.
Current wording
After considering interest income of $15,173 and administration expense of $234,286, distributable income for the quarter ended June 30, 2024,was $1,345,758, or $0.224293 per unit of beneficial interest. Administration expense for the quarter increased $94,832 from the prior year quarter, primarily related to the timing of receipt and payment of Trust expenses and terms of professional services. Changes in interest income are attributable to fluctuations in net profits income, expense reserve, and interest rates. For second quarter 2023, distributable income was $3,040,614, or $0.506769 per unit.
Previous wording
For the quarter ended March 31, 2024, net profits income was $1,837,741 compared to $3,912,704 for first quarter 2023. This 53 percent decrease in net profits income is primarily the result of decreased gas production ($2.3 million), lower gas prices ($0.6 million), increased development costs ($0.4 million), lower oil prices ($0.2 million), and decreased oil production ($0.1 million), partially offset by net excess costs activity ($0.8 million), decreased taxes, transportation and other costs ($0.6 million), and decreased production expenses ($0.1 million). See “Net Profits Income” below.
Current wording
For the six months ended June 30, 2024, net profits income was $3,402,612 compared to $7,075,763 for the same 2023 period. This 52 percent decrease in net profits income is primarily the result of lower gas prices ($2.7 million), decreased gas production ($1.8 million), increased development costs ($0.6 million), and decreased oil production ($0.1 million), partially offset by decreased taxes, transportation and other costs ($0.8 million), net excess costs activity ($0.6 million), and decreased production expenses ($0.1 million). See “Net Profits Income” below.
Previous wording
Because of the interval between time of production and receipt of royalty income by the Trust, oil and gas sales for the quarter ended March 31 generally represent oil production for the period November through January and gas production for the period October through December.
Current wording
Because of the interval between time of production and receipt of royalty income by the Trust, (1) oil and gas sales for the quarter ended June 30 generally represent oil production for the period February through April and gas production for the period January through March and (2) oil and gas sales for the six-months ended June 30 generally represent oil production for the period November through April and gas production for the period October through March.
Previous wording
The following are explanations of significant variances on the underlying properties from first quarter 2023 to first quarter 2024:
Current wording
The following are explanations of significant variances on the underlying properties from second quarter 2023 to second quarter 2024 and from the first six months of 2023 to the comparable period in 2024:
Previous wording
Gas sales volumes decreased 69 percent from first quarter 2023 to first quarter 2024 primarily due to the absence of receipts for the New Mexico royalty interest net profits interests related to March 2018 to December 2020 production and natural production decline.
Current wording
Gas sales volumes increased 27 percent for the second quarter primarily because of out of period revenues related to non-operated properties in the Oklahoma royalty interest net profits interests, partially offset by timing of receipts and natural production decline. Gas sales volumes decreased 45 percent for the six-month period primarily due to absence of receipts for the New Mexico royalty interest net profits interests related to March 2018 to December 2020 production and natural production decline, partially offset by out of period revenues attributable to non-operated properties in the Oklahoma royalty interest net profits interests.
Previous wording
Taxes, transportation and other costs decreased 56 percent for first quarter 2024 primarily because of decreased gas deductions and gas severance taxes on lower revenues.
Current wording
Taxes, transportation and other costs decreased 33 percent for the second quarter and 48 percent for the six-month period primarily because of decreased gas deductions and gas production taxes on lower revenues driven by timing of receipts.
Previous wording
Development costs related to properties underlying the 75% net profits interests increased 87 percent for first quarter 2024 primarily because of the timing of the receipt of costs for drilling activity that occurred in the second half of 2023 for the Hewitt Unit.
Current wording
Development costs related to properties underlying the 75% net profits interests increased 290 percent for the second quarter and 115 percent for the six-month period primarily because of the timing of the receipt of costs for drilling activity that occurred in the second half of 2023 for the Hewitt Unit.
Previous wording
If monthly costs exceed revenues for any conveyance, such excess costs must be recovered, with accrued interest, from future net proceeds of that conveyance and cannot reduce net proceeds from any other conveyance. Underlying cumulative excess costs for the Texas and Oklahoma working interest conveyances remaining as of March 31, 2024, totaled $4.1 million ($3.1 million net to the Trust), including accrued interest of $0.9 million ($0.7 million net to the Trust). For further information on excess costs, see Note 4 to Condensed Financial Statements.
Current wording
If monthly costs exceed revenues for any conveyance, such excess costs must be recovered, with accrued interest, from future net proceeds of that conveyance and cannot reduce net proceeds from any other conveyance. Underlying cumulative excess costs for the Texas and Oklahoma working interest conveyances remaining as of June 30, 2024, totaled $3.7 million ($2.8 million net to the Trust), including accrued interest of $1.0 million ($0.7 million net to the Trust). For further information on excess costs, see Note 4 to Condensed Financial Statements.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
For the quarter ended June 30, 2024, net profits income was $1,564,871 compared to $3,163,059 for second quarter 2023. This 51 percent decrease in net profits income is primarily the result of lower gas prices ($1.9 million), net excess costs activity ($0.2 million), increased development costs ($0.2 million), partially offset by increased gas and oil production ($0.3 million), decreased taxes, transportation and other costs ($0.2 million), higher oil prices ($0.1 million), and decreased production expenses ($0.1 million). See “Net Profits Income” below.
Current report — wording carried from elsewhere
After considering interest income of $32,146 and administration expense of $595,786, distributable income for the six months ended June 30, 2024, was $2,838,972, or $0.473162 per unit of beneficial interest. Administration expense for the six months ended June 30, 2024, increased $168,488 from the prior year six-month period, primarily related to the timing of receipt and payment of Trust expenses and terms of professional services. Changes in interest income are attributable to fluctuations in net profits income, expense reserve, and interest rates. For the six months ended June 30, 2023, distributable income was $6,679,812, or $1.113302 per unit.