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FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 1996
Commission File No. 0-10810
KIEWIT ROYALTY TRUST
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
Nebraska 47-6131402
- ---------------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
</TABLE>
First Bank, National Association
1700 Farnam Street
Omaha, Nebraska 68102
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(Address of Principal Executive Offices)
(402) 348-6000
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(Registrant's telephone no. including area code)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No
----- -----
APPLICABLE ONLY TO CORPORATE REGISTRANTS
Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of the latest practicable date.
As of June 30, 1996, there were 12,633,432 Units of Beneficial
Interest of the registrant outstanding.
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
KIEWIT ROYALTY TRUST
STATEMENT OF ASSETS, LIABILITY AND TRUST CORPUS
as of June 30, 1996 and December 31, 1995
<TABLE>
<CAPTION>
ASSETS 1996 1995
- ------ ---- ----
<S> <C> <C>
Cash and short-term investments $ 290,885 $ 162,011
Net royalty and overriding
royalty interests in coal
leases:
Estimated fair market value
at date of transfer to Trust $ 73,878,000 $ 73,878,000
Allowance to reduce carrying
value to Peter Kiewit Sons'
Inc.'s historical book value (73,710,183) (73,710,183)
------------ ------------
$ 167,817 $ 167,817
Less accumulated amortization (74,726) (70,897)
Net royalty and overriding
royalty interests in coal
leases $ 93,091 $ 96,920
------------ ------------
Total Assets $ 383,976 $ 258,931
============ ============
LIABILITY AND TRUST CORPUS
- --------------------------
Distribution payable to
Unit Holders $ 290,885 $ 162,011
Trust corpus: 12,633,432
units of beneficial interest
authorized and outstanding $ 93,091 $ 96,920
------------ ------------
Total Liability and Trust Corpus $ 383,976 $ 258,931
============ ============
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The accompanying notes are an integral part
of the financial statements
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KIEWIT ROYALTY TRUST
STATEMENT OF DISTRIBUTABLE INCOME
For the Three Months and Six Months Ended June 30, 1996 and 1995
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
-------------------------------- -----------------------------------
1996 1995 1996 1995
--------- --------- --------- ----------
<S> <C> <C> <C> <C>
Royalty Income $296,676 $463,928 $2,540,357 $3,908,751
Interest Income 8,163 17,104 31,369 54,639
Trust Expenses (13,954) (14,387) (29,472) (17,387)
-------- -------- -------- --------
Distributable
Income $290,885 $466,645 $2,542,254 $3,946,003
Distributable
income per unit
(12,633,432 units) $0.023025 $0.036937 $0.201232 $0.312346
</TABLE>
STATEMENT OF CHANGES IN TRUST CORPUS
For the Six Months Ended June 30, 1996 and 1995
<TABLE>
<CAPTION>
1996 1995
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<S> <C> <C>
Trust Corpus as of
January 1 $ 96,920 $ 108,822
Amortization of
royalty interest (3,829) (5,071)
Distributable Income 2,542,254 3,946,003
Distribution to Unit
Holders (2,542,254) (3,946,003)
------------ ------------
Trust Corpus as of
June 30 $ 93,091 $ 103,751
=========== ===========
</TABLE>
See Accompanying Notes to Financial Statements
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KIEWIT ROYALTY TRUST
Notes to Financial Statements
as of June 30, 1996 and December 31, 1995
BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with the instructions for Form 10-Q and do not necessarily include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the Trustee's opinion, all
adjustments necessary for a fair presentation have been included. For further
information, refer to the financial statements and footnotes included in the
Trust's annual report on Form 10-K for the year ended December 31, 1995.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying unaudited financial statements have been prepared on
the following basis:
(a) The royalty income recorded for a month is the amount computed
and paid by the lease holder to the Trustee for such month.
(b) Trust administration expenses are recorded in the month they
accrue.
This basis for reporting royalty income is thought to be the most meaningful
because distributions to the Unit Holders for a month are based on net cash
receipts for such month. However, these statements differ from financial
statements prepared in accordance with generally accepted accounting principles
because, under such principles, royalty income for a month would be based on
production for such month without regard to when calculated or received. In
addition, amortization of the net royalty and overriding royalty interests,
which is calculated on a units-of-production basis by lease, is charged
directly to trust corpus, since such amount does not affect distributable
income.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
a. MATERIAL CHANGES IN FINANCIAL CONDITION.
Kiewit Royalty Trust is a royalty trust with royalty and
overriding royalty interests in certain coal leases. The Trust was formed for
the purposes of (1) administering the income received from such coal leases and
(2) distributing such income (together with interest earned thereon less
payment of or provision for obligations) to the holders of the Units of
Beneficial Interest.
b. MATERIAL CHANGES IN RESULTS OF OPERATIONS.
During the six months ended June 30, 1996, the Trust received
a total of $2,540,357 of royalty and overriding royalty payments; during the
three months ended June 30, it received a total of $296,676 of such payments.
The following schedule reflects the royalty and overriding royalty amounts
received by the Trust from each mine.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
Mine June 30 June 30
---- ----------------------------- -----------------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Black Butte $ 14,487 $198,890 $ 152,026 $ 494,659
Decker 230,673 230,314 2,335,322 3,305,570
Big Horn 1,516 34,724 3,009 108,522
Spring Creek 50,000 --- 50,000 ---
-------- -------- ---------- ----------
$296,676 $463,928 $2,540,357 $3,908,751
======== ======== ========== ==========
</TABLE>
I. BLACK BUTTE MINE.
The Trust received $152,026 from the Black Butte Mine during the first
six months of 1996, as compared to $494,659 during the first six months of
1995, and $14,487 during the three months ended June 30, 1996, as compared to
$198,890 during the three months ended June 30, 1995. The decrease in
royalties received during the first six months and second quarter of 1996 as
compared to the corresponding periods of 1995 reflects decreased sales from the
Black Butte mine as well as the fact that federal lease number W-6266 was
renewed effective April 1, 1996 and the Trust no longer receives an overriding
royalty on coal produced after March 31, 1996, as explained below.
Lease number W-6266 provides that the terms and conditions of the lease
are subject to "reasonable readjustment" effective on April 1, 1996. At that
time, the royalty rate payable to the United States was increased to 12- 1/2%,
which is
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the currently prevailing federal royalty rate. Because of the cap on the
amount of the overriding royalty payable to the Trust with respect to this
lease, the increased federal royalty rate has effectively eliminated
further payments to the Trust with respect to this lease.
ii. DECKER MINE.
The amount of royalties and overriding royalties received by the Trust
with respect to the Decker Mine decreased to $2,335,322 in the first six months
of 1996 compared to $3,305,570 during the same period in 1995. For the second
quarter, the amounts received increased to $230,673 compared to the $230,314
received during the second quarter of 1995. These changes in royalty and
overriding royalty amounts received were due to changes in the relative amounts
of coal mined under leases bearing high and low overriding royalty rates per
ton, which are a normal result of the execution of a mining plan encompassing
several coal leases bearing different royalty rates.
iii. BIG HORN MINE.
Royalties received from the Big Horn Mine decreased to $1,516 during
the second quarter of 1996 from $34,724 in 1995, and overall receipts for the
first six months of 1996 decreased to $3,009 compared to $108,522 during the
corresponding period in 1995. These decreases for 1996 reflect decreased
production in the relative amounts of coal mined under leases bearing high and
low overriding royalty rates per ton. The relatively small amount of receipts
generally reflects minimal current production at the mine.
iv. SPRING CREEK MINE.
The Trust received $50,000 from the Spring Creek Mine during the first
six months of 1996 as compared to no royalties in the first half of 1995. The
amount for 1996 represents the minimum annual royalty, which was received
during the second quarter; in 1995, the minimum annual royalty was received
during the third quarter.
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PART II - OTHER INFORMATION.
ITEM 1. LEGAL PROCEEDINGS.
There are no material pending legal proceedings to which the Trust is a
party of which any of its property is the subject.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
27.1 Financial Data Schedule.
(b) No reports on Form 8-K were filed during the quarter for which
this report is filed.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
KIEWIT ROYALTY TRUST
(Registrant)
By: First Bank, National Association, in
its capacity as Trustee and not in
its individual capacity or otherwise
By: /s/ Susan K. Rosburg
--------------------------------
Susan K. Rosburg
Trust Officer
Dated: August 13, 1996
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<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 290,885
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 383,976
<CURRENT-LIABILITIES> 290,885
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 93,091
<TOTAL-LIABILITY-AND-EQUITY> 383,976
<SALES> 0
<TOTAL-REVENUES> 2,571,726
<CGS> 0
<TOTAL-COSTS> 2,542,254
<OTHER-EXPENSES> 29,472
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0.20
<EPS-DILUTED> 0.20
</TABLE>
