DMLP

Dorchester is a pure mineral & royalty partnership, not an operator: it owns perpetual interests across 594 counties in 28 states (2.95M gross / 473K net mineral acres, concentrated in Texas, North Dakota and the Rockies) and simply collects checks. That model shows in a fortress balance sheet — $310M assets against just $4.32M total liabilities ($3.79M of it current) and $41.9M cash, i.e. effectively no debt and no refinancing or capex burden. Operating cash flow held flat at $132M (-0.1%), and the partnership distributed essentially all of it ($132.0M) to unitholders, which against the $1.22B market cap is a ~10.8% payout. For a self-directed income investor that combination of zero leverage and a double-digit yield is the core of the appeal.

The problem is the trajectory. Net income fell 38% to $57.4M and revenue slipped 5.4% to $153M, the fourth straight year of declining sales (from $171M in 2022). Management is explicit on the cause: lower industry-wide realized oil prices, lower NPI volumes from reduced Bakken drilling, and higher capex deducted under the NPI calculation — only partly offset by Rockies drilling, acquisitions and stronger gas prices. Depletion (D&A) jumped 55.7% to $66.3M, compressing reported earnings even as cash flow stayed stable. Because distributions track net income/cash flow, the headline yield is variable and would fall if oil stays soft — this is not a fixed coupon.