Mexco Energy Corporation Reports Profitable First Quarter

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Aug 13, 2010, 06:21 ET

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