Mexco Energy Corporation Reports Profitable First Quarter

MIDLAND, Texas, Aug. 13 /PRNewswire-FirstCall/ -- Mexco Energy Corporation (Amex: MXC) today reported net income of $5,776 for the quarter ending June 30, 2010, the Company's first quarter of fiscal 2011, compared to a net loss of $68,003 for the same quarter of fiscal 2010.  

Operating revenues in the first quarter of fiscal 2011 were $836,393, an increase of $178,216 or 27% from $658,177 for the first quarter of fiscal 2010.      

The average sales price for the quarter ending June 30, 2010 was $5.65 per Mcfe compared to $3.98 per Mcfe for the quarter ending June 30, 2009, an increase of 42%.  Oil production increased 4% and gas production decreased 13% during the first quarter of fiscal 2011 as compared to the first quarter of fiscal 2010.

Mexco Energy Corporation owns oil and gas properties in ten states, with the majority of its activity centered in West Texas.  The Company plans to continue to focus its efforts to increase oil and natural gas reserves through exploration and development as well as acquisition of royalties with significant development potential.


Mexco Energy Corporation and Subsidiary

CONSOLIDATED BALANCE SHEETS






June 30,


March 31,






2010


2010






(Unaudited)



ASSETS







Current assets






Cash and cash equivalents

$      141,457


$      160,439



Accounts receivable:







Oil and gas sales

430,732


538,444




Trade                                                                    

22,136


63,455




Related parties

-


55



Prepaid costs and expenses

56,399


17,161





Total current assets

650,724


779,554










Property and equipment, at cost






Oil and gas properties, using the full cost method

27,439,085


27,353,016



Other


78,520


76,161






27,517,605


27,429,177











Less accumulated depreciation, depletion and amortization

14,430,651


14,179,156





Property and equipment, net

13,086,954


13,250,021






$ 13,737,678


$  14,029,575









LIABILITIES AND STOCKHOLDERS' EQUITY





Current liabilities






Accounts payable and accrued expenses

$      401,078


$      301,160



Current portion of long-term debt

325,000


-





Total current liabilities

726,078


301,160










Long-term debt

-


700,000


Asset retirement obligation

498,180


486,305


Deferred income tax liabilities

853,748


902,757







Commitments and contingencies













Stockholders' equity






Preferred stock - $1.00 par value;







10,000,000 shares authorized; none outstanding

-


-



Common stock - $0.50 par value; 40,000,000 shares authorized;







2,006,366 and 2,003,866 shares issued;

1,922,366 and 1,919,866 shares outstanding







as of June 30, 2010 and March 31, 2010, respectively

1,003,183


1,001,933



Additional paid-in capital

5,921,192


5,907,899



Retained earnings

5,161,914


5,156,138



Treasury stock, at cost (84,000 shares)

(426,617)


(426,617)


Total stockholders' equity

11,659,672


11,639,353






$ 13,737,678


$ 14,029,575





Mexco Energy Corporation and Subsidiary

CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three Months Ended June 30,

(Unaudited)






2010


2009

Operating revenues:





Oil and gas

$   832,010


$   653,810


Other



4,383


4,367



Total operating revenues

836,393


658,177









Operating expenses:





Production

368,227


240,973


Accretion of asset retirement obligation

8,430


7,728


Depreciation, depletion and amortization

251,495


263,462


General and administrative

248,139


232,185



Total operating expenses

876,291


744,348









Operating loss

(39,898)


(86,171)









Other income (expense):





Interest income

4


166


Interest expense

(3,339)


(9,624)



Net other expense

(3,335)


(9,458)









Loss before provision for income taxes

(43,233)


(95,629)









Income tax benefit:





Current  


-


-


Deferred


(49,009)


(27,626)






(49,009)


(27,626)










Net income (loss)

$         5,776


$     (68,003)










Earnings (loss) per common share:






Basic


$           0.00


$         (0.04)



Diluted

$           0.00


$         (0.04)


Weighted average common shares outstanding:






Basic

1,922,152


1,878,616



Diluted

1,946,847


1,878,616




In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, Mexco Energy Corporation cautions that statements in this press release which are forward-looking and which provide other than historical information involve risks and uncertainties that may impact the Company's actual results of operations. These risks include, but are not limited to, production variance from expectations, volatility of oil and gas prices, the need to develop and replace reserves, exploration risks, uncertainties about estimates of reserves, competition, government regulation, and mechanical and other inherit risks associated with oil and gas production.  A discussion of these and other factors, including risks and uncertainties, is set forth in the Company's Form 10-K for the fiscal year ended March 31, 2010.  Mexco Energy Corporation disclaims any intention or obligation to revise any forward-looking statements.

For additional information, please contact:  Nicholas C. Taylor, President and Chief Executive Officer or Tammy L. McComic, Executive Vice-President and Chief Financial Officer, both of Mexco Energy Corporation, (432) 682-1119.

SOURCE Mexco Energy Corporation



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