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Sabine Royalty Trust Message Board

  • wblackbu wblackbu May 8, 2008 9:54 AM Flag

    Dumb Question: Unit = Share?

    Subject says it. When they declare a monthly cash distribution in terms of so-and-so per unit - does that meann that amount per common share of SBR? Do all royalty trusts do it the same way, or are some X shares per unit, etc?


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    • SBR is a trust, not a company. It pays no income taxes as a company would. Excess cash is distributed to the unit holders monthly. Although traded on the NYSE it trades in units and pays monthly distributions/unit not dividends/share as a company would. Cash distributions, unless held in a tax deferred account, are taxed as ordinary income, less any depletion allowances taken, whereas dividends are generally taxed at the dividend tax rate.

      Not a dumb question. Just confusing because it trades on the NYSE.

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