2014

Mexco Energy Corporation Reports Profitable Third Quarter

MIDLAND, Texas, Feb. 14, 2012 /PRNewswire/ -- Mexco Energy Corporation (AMEX: MXC) today reported net income of $50,961 for the quarter ending December 31, 2011, the Company's third quarter of fiscal 2012, a 89% increase from $26,898 for the same quarter of fiscal 2011.  

Operating revenues in the third quarter of fiscal 2012 were $757,560, a slight increase from $756,576 for the third quarter of fiscal 2011.

The average sales price for the quarter ending December 31, 2011 was $6.10 per Mcfe compared to $5.34 per Mcfe for the quarter ending December 31, 2010, an increase of 14%.  Oil production increased 13% and gas production decreased 18% during the third quarter of fiscal 2012 as compared to the third quarter of fiscal 2011.  This decrease in gas production is attributable to natural decline and certain production shut-in for repairs and maintenance.  

For the nine months ended December 31, 2011, the Company reported net income of $234,618, a 128% increase from $102,714 for the same period of fiscal 2011.  Operating revenues increased 4% to $2,482,415 for the nine months ended December 31, 2011 from $2,381,608 for the same period of fiscal 2011.  

The average sales price of oil and natural gas for the nine months ended December 31, 2011 was $6.33 per Mcfe compared to $5.50 per Mcfe for the quarter ending December 31, 2010, an increase of 15%.  Oil production increased 8% and gas production decreased 13% for the nine months ended December 31, 2011 as compared to the same period of fiscal 2011.  

During the first nine months of fiscal 2012, Mexco participated in the drilling of three wells in the Fuhrman-Mascho Field of Andrews County, Texas.  This property, operated by Cone and Petree Oil & Gas Exploration, Inc. now contains the four original wells plus the three new wells for a total of seven wells - four producing oil from the San Andres formation and three producing oil from the Grayburg and San Andres formations at an approximate depth of 5,000 feet.  Mexco owns working interests of approximately 10% (7.2% net revenue interest) in this acreage.  This property contains an additional 9 potential drill sites in the Grayburg and San Andres formations with more dense spacing of approximately 10 acres per well.  

Also during the first nine months of fiscal 2012, Mexco participated in 37 infill wells in the Yeso/Paddock formations of the Dodd-Federal Unit in the Grayburg San Andres Jackson Field of Eddy County, New Mexico.  These wells are proposed to be drilled in the next twelve months to a total depth of approximately 5,000 feet.  The unit, operated by Concho Resources, Inc., currently contains approximately 110 wells producing primarily oil.  Mexco's working interest in this unit is .1848% (.14% net revenue interest).  

Mexco Energy Corporation owns oil and gas properties in twelve states, with the majority of its activity centered in West Texas.  

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, 2011.  Mexco Energy Corporation disclaims any intention or obligation to revise any forward-looking statements.


Mexco Energy Corporation and Subsidiaries

CONSOLIDATED BALANCE SHEETS














December 31,


March 31,






2011


2011






(Unaudited)



ASSETS





Current assets






Cash and cash equivalents

$      75,170


$      179,071



Accounts receivable:







Oil and gas sales

383,880


384,215




Trade

23,587


42,432




Related parties

-


-



Prepaid costs and expenses

61,328


64,479





Total current assets

543,965


670,197










Property and equipment, at cost






Oil and gas properties, using the full cost method

30,588,638


30,426,817



Other

78,520


78,520






30,667,158


30,505,337











Less accumulated depreciation, depletion and amortization

15,929,424


15,227,063





Property and equipment, net

14,737,734


15,278,274






$ 15,281,699


$ 15,948,471









LIABILITIES AND STOCKHOLDERS' EQUITY





Current liabilities






Accounts payable and accrued expenses

$      181,121


$      199,944










Long-term debt

750,000


1,800,000


Asset retirement obligations

567,592


528,911


Deferred income tax liabilities

862,554


912,663










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;







2,089,116 shares issued;

2,025,949 and 2,029,949 shares outstanding as of December 31, 2011 and March 31, 2011, respectively

1,044,558


1,044,558



Additional paid-in capital

6,654,867


6,453,226



Retained earnings

5,546,452


5,311,834



Treasury stock, at cost - 63,167 and 59,167 shares as of







December 31, 2011 and March 31, 2011, respectively

(325,445)


(302,665)


Total stockholders' equity

12,920,432


12,506,953






$ 15,281,699


$ 15,948,471





Mexco Energy Corporation and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)







Three Months Ended


Nine Months Ended






December 31,


December 31,






2011


2010


2011


2010

Operating revenue:









Oil and gas

$    753,789


$   752,778


$ 2,469,784


$2,368,778


Other

3,771


3,798


12,631


12,830



Total operating revenues

757,560


756,576


2,482,415


2,381,608













Operating expenses:









Production

233,317


200,785


697,548


822,150


Accretion of asset retirement obligation

9,297


8,489


27,033


25,463


Depreciation, depletion, and amortization

223,181


244,065


702,362


763,251


General and administrative

227,928


235,137


723,489


682,820



Total operating expenses

693,723


688,476


2,150,432


2,293,684













Operating profit

63,837


68,100


331,983


87,924













Other income (expenses):









Interest income

47


10


141


36


Interest expense

(5,854)


(15,151)


(22,735)


(25,347)















Net other expense

(5,807)


(15,141)


(22,594)


(25,311)













Earnings before provision for income taxes

58,030


52,959


309,389


62,613













Income tax expense (benefit):









Current

(4,858)


(59,500)


124,880


(25,502)


Deferred

11,927


85,561


(50,109)


(14,599)






7,069


26,061


74,771


(40,101)













Net income

$      50,961


$     26,898


$    234,618


$   102,714

























Earnings per common share:









Basic

$          0.03


$         0.01


$          0.12


$         0.05


Diluted

$          0.03


$         0.01


$          0.12


$         0.05













Weighted average common shares outstanding:









Basic

2,026,011


1,947,370


2,028,626


1,934,953


Diluted

2,031,453


1,961,041


2,037,994


1,951,316




SOURCE Mexco Energy Corporation



RELATED LINKS
http://www.mexcoenergy.com

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